Apple App Store prices, revenues adjusted for tax changes in some countries

These seem to be both uncertain yet also exciting times for app developers, especially on Apple’s platforms. There are big changes happening, both from Apple’s side as well as external forces, sometimes against Apple’s wishes. Things are still in a state of flux, with some news potentially favoring developers while others might be to their disadvantage. This latest from Apple is of the latter kind, with the company announcing some changes in at least eight countries that could affect developers’ overall profits.

App sales and in-app purchases are, of course, subject to each and every country’s tax laws, in addition to the app store taxes that Apple and Google themselves exact. Tax laws also change from time to time, and Apple says it has to adjust to take those into account. Unfortunately, that sometimes also means app prices have to be adjusted as well.

In Chile, Mexico, Saudi Arabia, and Turkey, higher value-added taxes and new digital taxes on top of those will cause app prices to rise. These could make paid apps and in-app purchases look less enticing, which could translate to lower sales and lower profits for app developers.

In Germany, France, Italy, and the UK, App Store prices will not change but developers’ proceeds will be directly adjusted due to tax changes as well. Interestingly, German is actually reducing its VAT rate, which means revenue for developers here will increase instead.

These changes are definitely troubling news for developers during these already troubling times. On the upside, there are also attempts at legally changing the app store business in order to give developers a larger cut of the proceeds in the first place. With the world becoming more dependent on digital goods and mobile apps, stabilizing the app store industry has probably become even more critical than ever before.

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