Boeing announced April 29 that it saved $305 million through state tax breaks last year, marking the first time the company has been required by law to publicly disclose such information.
In a statement, the aerospace giant also said it invested more than $13 billion in the state in 2015 — citing tens of millions in community contributions as well as tuition for employees seeking continuing education. Company officials also noted the 777X composite wing center in Everett that’s opening next month.
“Boeing’s investments demonstrate that when a state creates competitive policies, its citizens reap tremendous benefits from the activity that follows,” said Bill McSherry, Boeing’s vice president of government operations and global corporate citizenship. “These incentives work.”
The disclosure — to be filed with the state Department of Revenue by May 2 — is a new requirement under a tax-incentive transparency law passed in 2013 that affects Boeing and hundreds of other aerospace firms in the state.
Later that year, the Legislature approved a suite of tax incentives aimed at Boeing and the aerospace sector meant to ensure that the 777X was produced in Everett. Most of the tax breaks were first approved in 2003 and set to expire in 2024, but the new legislation extended them until 2040.
State Sen. Reuven Carlyle, a Democrat from Seattle who had pushed for transparency of the tax exemptions, said April 29 that the information is “incredibly valuable for the public.”
“The public can now open the books and decide for themselves whether a tax break has a return on investment,” he said.
Carlyle said the $305 million in tax breaks compared to the $13 billion spent by the company is a “compelling return on investment and solidifies our state as the global center of innovation.”
Jon Holden, the president of Machinists Union District 751 in Seattle, cited the move of more than 1,000 high-skilled engineering jobs in the state to other regions as “a really bad return on our state’s investment of tax dollars.
“We’ve given Boeing the largest corporate tax incentives in U.S. history, but without any job requirements, all we’ve done is create incentives for Boeing to take away both our jobs and our tax dollars,” Holden said in a written statement.
Numbers released earlier this week showed the company had lower quarterly earnings compared to last year because of higher costs for Boeing’s products and labor.
Boeing is currently in the process of reducing its 160,000-person workforce by about 4,500 to help keep its costs under control.