Legislative Auditor's conclusion:
The preferences continue to meet legislative goals to lower costs, maintain the industry's presence, and encourage strong wages. Employment has decreased since 2019, and it remains unclear if job growth meets expectations.
Key points:
-The Legislature enacted nine tax preferences that benefit the aerospace industry. It repealed one preferential tax rate to comply with a World Trade Organization ruling.
-The preferences lower costs and improve competitiveness by reducing the industry's effective tax rate. However, the reduction is smaller than it was in 2019.
-Washington's aerospace industry is still among the largest in the country and pays wages that are above industry and statewide averages.
-Aerospace industry employment has declined since 2019. It is above 2003 levels, so it continues to be unclear if employment levels meet legislative expectations.
-Legislative Auditor recommends the Legislature clarify the employment objective and consider reviewing the preferences every 10 years, rather than the current five-year cycle.
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JLARC is a legislative committee in Washington State. We work to improve state government. We have an equal number of members from the House and Senate, evenly split between the parties.
Nonpartisan staff do research, complete audits, and present findings to the committee. The Legislative Auditor oversees the work.
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