Apple Raising App Store Prices in Chile, Mexico, Saudi Arabia and Turkey Due to Tax Changes

Tuesday September 1, 2020 11:22 am PDT by Juli Clover

Apple today began informing developers of upcoming App Store pricing changes in several countries due to tax changes, with the prices of apps and in-app purchases affected.

appstore
Prices are shifting in Chile, Mexico, Saudi Arabia, and Turkey.

Chile: New value-added tax of 19%
Mexico: New value-added tax of 16%
Saudi Arabia: Increase in value-added tax from 5% to 15%
Turkey: New digital services tax of 7.5% (in addition to the existing value-added tax of 18%)

According to Apple, developers will see their proceeds from ‌App Store‌ sales adjusted accordingly, with revenue calculated based on the tax-exclusive price.

‌App Store‌ proceeds will also be adjusted in Germany, France, Italy, and the UK due to tax changes, though ‌App Store‌ pricing will not be shifting.

Germany: Reduced value-added tax rate from 19% to 16%
France: New digital services tax of 3% (in addition to the existing value-added tax of 22%)
Italy: New digital services tax of 3% (in addition to the existing value-added tax of 22%)
United Kingdom: New digital services tax of 2% (in addition to the existing value-added tax of 20%)

Developers are able to download updated pricing charts from Apple's developer site to prepare for the upcoming changes. Developers are able to change the prices of apps, subscriptions, and in-app purchases, and can opt to preserve pricing for existing subscribers if desired. Apple says the price changes will go live "in the next few days."

Note: Due to the political or social nature of the discussion regarding this topic, the discussion thread is located in our Political News forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Tags: App Store, Apple Developer Program

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Top Rated Comments

TiggrToo

81 months ago

Apple is hungry for $$$ .
2 Trillion isn’t enough.

This has nothing to do with profiteering. They are required to collect sales tax/VAT and remit them to the appropriate governments.

The ignorance of your post was quite awful.

Score: 18 Votes (Like | Disagree)

SBlue1

81 months ago

What is "value-added tax"? and 19% seems really high for any tax.

Its sales tax. It’s 19% in Germany. If you see the number it surely seems high but when you see what you get for your taxes it’s ok again.

Score: 7 Votes (Like | Disagree)

Skylar.

81 months ago

Apple is hungry for $$$ .
2 Trillion isn’t enough.

Ah, you didn't read the full article did you? Just commented on the title.

Score: 5 Votes (Like | Disagree)

Wrathard

81 months ago

Sales tax is not VAT. They act and are calculated differently.

No, but it's certainly toward the upper end. At the very least, middle of the road as far as VAT goes.

Yeah, most of the rest of the world outside the U.S. uses VAT. VAT percentages seem high to us here in the US, but that's only because we are accustomed to paying all the tax at the sales end. When an American pays for a good with 8% sales tax, they are in fact paying 8% tax on top of the retail price. When someone buys a product with a 25% VAT, they might only be paying half of that 25% since the tax is not all charged to the consumer; as the name implies, it's based on the added value along the product chain.

VAT has its pros and cons though. It's more complex than sales tax, especially in long product chains. It can also increase the actual cost of goods, and of course companies have to pay VAT, unlike sales tax. OTOH, it's easier to audit than sales tax if recorded properly, and in general consumers pay less tax on goods (if the VAT is roughly 16% or less, compared to 8% average U.S. sales tax)

VAT and Sales Tax while conceptually different, are the same for the end customer.

If an item is sold for $100 w/ a 16% sales tax the customer pays $116.

If an item is sold for $100 w/ a 16% VAT the customer still pays $116.

Who collects and pays govt. is irrelevant. End customer gets charged the same whether it's Sales Tax or VAT.

Score: 5 Votes (Like | Disagree)

123

81 months ago

With a VAT, it is more a sneaky tax

There's nothing sneaky about it, you see it on every receipt.

The difference is that the price listed is the price you pay, while in North America the tax is added later which means actual prices are not transparent to the consumer. In Europe this would be misleading advertising, like a cheap flight advertised for EUR 50, then add airport tax, fuel tax, city tax, state tax, online booking charge, payment service charge, ticket service surcharge... final price 350.

Score: 4 Votes (Like | Disagree)

MauiPa

81 months ago

Apple is hungry for $$$ .
2 Trillion isn’t enough.

That literally makes no sense. Countries tax services, who do you think pays those taxes? Always the consumer. Just like the infamous tariffs here in the US, despite lies to the contrary, the consumer pays those taxes.

Score: 4 Votes (Like | Disagree)

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Apple Raising App Store Prices in Chile, Mexico, Saudi Arabia and Turkey Due to Tax Changes

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