The news that Boeing will move 787 production from Everett to South Carolina is disappointing, though not unexpected given the crippling effects of COVID-19 on airplane demand. Gov. Inslee and others have responded by suggesting that Boeing should be paying more in state taxes.

In a statement, Gov. Inslee said, “Boeing’s decision to take the 787 to South Carolina necessitates a review of our partnership and the company’s favorable tax treatment.” The Seattle Times reports, “Speaking at a news conference Thursday, Inslee said he had not made any decisions, but insisted Boeing’s preferential tax treatment — long enshrined in Washington’s tax code through bipartisan votes — will be on the table in the coming months.”

We wrote about that tax treatment in a 2014 policy brief. As we noted, competitive tax policy is not a subsidy: “It’s a pragmatic response to the marketplace, including the global competition for major industrial projects.” Indeed, as we wrote then, the tax preferences Gov. Inslee is referring to “were intended to bring Boeing’s taxes in Washington into line with what they would be in other states.” (Note that, in general, many of Washington’s tax “preferences” really “work to normalize Washington’s tax structure by reducing distortions, offsetting disincentives and avoiding pyramiding.”)

If Boeing has decided that it is best for its business to build the 787 elsewhere, it has surely taken all considerations into account—including, but not limited to, taxes. Increasing taxes for the company would do nothing to get 787 production back, and it could make Washington less competitive in any considerations about the future of other lines of production. As noted above, tax preferences are not subsidies. They are lower tax rates. If higher taxes result in more production moving out of Washington, the state would collect less revenue than it does with the current tax preferences in place. The governor and lawmakers should consider Washington’s long-term competitiveness for aerospace jobs before rushing to raise taxes.