subsidy

American  

[suhb-si-dee] / ˈsʌb sɪ di /

noun

plural

subsidies

1. a direct pecuniary aid furnished by a government to a private industrial undertaking, a charity organization, or the like.

2. a sum paid, often in accordance with a treaty, by one government to another to secure some service in return.

3. a grant or contribution of money.

4. money formerly granted by the English Parliament to the crown for special needs.

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subsidy British  

/ ˈsʌbsɪdɪ /

noun

1. a financial aid supplied by a government, as to industry, for reasons of public welfare, the balance of payments, etc

2. English history a financial grant made originally for special purposes by Parliament to the Crown

3. any monetary contribution, grant, or aid

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subsidy Cultural  

1. A grant made by a government to some individual or business in order to maintain an acceptable standard of living or to stimulate economic growth.

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Usage

What does subsidy mean? A subsidy is a direct payment made by a government to a company or other organization as a form of assistance. To grant subsidies is to subsidize, and the process of doing so is subsidization. Governments that grant subsidies often provide them for particular industries, such as farming. The word is most commonly used to refer to such payments. More generally, subsidy can refer to any grant or monetary contribution. More specifically, it can refer to a payment made by one government to another for a particular service, often according to a treaty. Example: My company received a government subsidy to help expedite the manufacturing of healthcare products.

Related Words

Subsidy, subvention are both grants of money, especially governmental, to aid private undertakings. A subsidy is usually given to promote commercial enterprise: a subsidy to manufacturers during a war. A subvention is usually a grant to stimulate enterprises connected with science and the arts: a subvention to a research chemist by a major company.

Other Word Forms

• antisubsidy noun
• nonsubsidy noun

Etymology

Origin of subsidy

First recorded in 1325–75; Middle English subsidie, from Anglo-French, from Latin subsidium “auxiliary force, reserve, help,” equivalent to sub- sub- + sid-, combining form of sedēre “to sit” ( sit ¹ ) + -ium -ium

Explanation

A subsidy is a grant of financial assistance. Many school districts, for example, offer a subsidy to low-income families for book fees and lunch costs. The family pays a set amount and the district makes up the difference. The noun subsidy comes from French and Latin roots that mean "help and aid." Subsidies are most often offered by the government, but individuals can offer subsidies as well. "The parents offered to give a subsidy for students to go on the ski trip. The deal was that if the kids earned half the money, the parents would pay for the other half."

Example Sentences

The 2026 fuel subsidy calculation was premised on a global oil price of $70 per barrel, but prices have since topped $100.

From Barron's • Mar. 31, 2026

The government has so far defended the subsidy, which at $12.3 billion represents about five percent of the total annual budget for 2026.

From Barron's • Mar. 31, 2026

However, pressure lingers as Nomura analysts expect Alibaba’s food-delivery subsidy budget to remain high.

From The Wall Street Journal • Mar. 30, 2026

"The fuel subsidy from the government isn't enough. It's for a two-day drive. So what happens after two days? Our situation now is worse than during the pandemic," Carlos said.

From BBC • Mar. 24, 2026

For this reason, it is absolutely against his wishes that parties in Iceland and elsewhere should provide financial subsidy for the production of this film or should show it once completed.

From "Endgame" by Frank Brady

Related Words

• aid
• allowance
• appropriation
• assistance
• bonus
• contribution
• endowment
• financial aid
• gift
• grant
• payment
• pension
• premium
• scholarship
• support