Patrik Siwek Apple sent out an email to App Store app developers this morning informing them of upcoming price changes in select countries. According to Apple, this is a consequence of changes in value added tax, i.e. VAT, in some countries. In order for Apple to maintain the ratio of profit sharing between the developers and the company itself, and at the same time for the prices to continue to be nicely rounded, according to their own words, they have to proceed with price changes. However, it is interesting and gratifying that the price changes will also affect countries in which VAT has not changed, and the Czech Republic is also among them.
As part of tax optimization, Apple tries to merge individual App Stories into regions and pay taxes where it is most advantageous, which means that the changes affect not only the countries in which the VAT changes directly occurred, but also other countries that Apple includes to their regions. Fortunately for us, this time the prices in the Czech App Store will not increase, but on the contrary, they will decrease. We will see the new prices later this week, and it is very likely that you will hardly notice them, since they will be changes in the order of one percent. The change affects both the Mac App Store and the iTunes App Store. Apple states the following in its email:
“As of January 1, 2018, the value added tax (VAT) applicable to your app sales and in-app purchases has changed in some countries. We manage the collection of taxes from customers and the remittance of taxes to the relevant tax authorities in, among others, Armenia, Belarus, Turkey, Switzerland, Saudi Arabia and the United Arab Emirates, where the amount of VAT has been changed or where VAT has been newly introduced. There will be price updates in the following countries this week
- Czech Republic – Prices for apps and in-app purchases will be reduced, except for automatic subscriptions
- Indie – Prices for apps and in-app purchases will be reduced, except for automatic subscriptions
- Turkey, Nigeria, Belarus, Armenia – Prices for apps and in-app purchases will increase with the exception of automatic subscriptions
You can change the prices of your auto-renewable subscription at any time in iTunes Connect to keep subscribers at the current prices. Your earnings will be adjusted accordingly and calculated based on the new prices. The Prices and Services section in iTunes connect will be updated based on the new prices. If you have questions, please contact us. Sincerely, the App Store team.
A strengthening crown?
This is also in play, but Apple rather justified it with VAT changes :)