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Boeing Live Event Coverage

Seattle Times aerospace reporter Dominic Gates covers top industry events to bring you the latest news, highlighting how it impacts Boeing and its competitors.

September 27, 2011 at 1:46 PM

Does Boeing pay state sales tax on those Dreamliners?

Posted by Dominic Gates

A reader asked this question in the live chat just finished and I didn't give a very defintiive answer. Let me do so here.

Boeing does pay B&O sales tax on airplanes delivered out of Washington but at a reduced rate thanks to the 787 incentive package from 2003.

The regular B&O tax rate for manufacturing is 0.00484. The rate for aerospace manufacturing through 2024 is set at 0.002904. If manufactured in Washington, it is subject to this tax, even if it is sold and delivered elsewhere.

So I think that means for the early Dreamliners delivered, the state should get about $100 million (the approximate market value) x 0.002904, which is about $290,000. Of course, the first jets were so delayed and so reworked that Boeing had to compensate the airlines, so the earliest ones may have a sales tag lower than $100 milllion.

In addition, Boeing (and other aerospace manufacturers) get various tax credits from Washington state, including those for computer hardware and software, property taxes on new buildings, and pre-production development expenses on new jets.

For folks riven with business ignorance and a desire to stick it to the evil corporations.Think of this.The plane sells for $100 mil and probably...  Posted on September 28, 2011 at 11:08 AM by motnam. Jump to comment
@girl power; Although doing what you suggest would likely have caused Boeing and/or others to have moved those manufacturing jobs elsewhere, and...  Posted on September 28, 2011 at 9:37 AM by W. Swigart. Jump to comment
The long-awaited ride, which is also enhanced in terms of fuel efficiency, will continue to be monitored for another month by the travel industry...  Posted on September 28, 2011 at 2:15 AM by amadalong. Jump to comment

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