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In 2 0 1 6 , the WTO ruled that a tax break given by Washington State for the aerospace industry was a prohibited subsidy.

In 2016, the WTO ruled that a tax break given by Washington State for the aerospace industry was a prohibited subsidy. The tax cut was agreed to when Boeing was considering where to establish a new assembly base, and it was designed to help Boeing develop its new 777X jetliner. Explain how a tax break might serve as a subsidy and thus be prohibited by the WTO. Would it surprise you to learn that, for over 12 years, Boeing and Airbus have accused one other of receiving tens of billions of illegal subsidies? Is it unethical for either of these two companies to have accepted state aid while attacking the other for doing so? Or is this behavior an acceptable means of maximizing profits and getting ahead of the competition?

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