14 DAY TRIAL // Starting next year, customers as well as developers will incur price changes across Apple’s European app stores, according to an email from Cupertino this week.
Developers selling apps in countries member of the European Union might need to reconsider their pricing schemes, should they want to sustain their current lifestyle through 2015 and beyond. Customers might also end up paying more for the apps they download. By a decision of Apple, new tax rates will be applied to their apps based on each country’s laws.
Apple’s email
Leaked by a developer with access to iTunes Connect (a tool used to submit new apps but also to track app analytics and finance-related stuff), the email sent out by the company this week states the following:
“On January 1, 2014 [sic], value-added tax (VAT) rates for apps will change for all territories in the European Union. VAT will be based on the customer's country of residence instead of being the same across all EU territories.”
The email, which apparently mistakes in the cited year (2014 instead of 2015) informs developers that their proceeds – the 70/30 cut between them and Apple – will be calculated after VAT is deducted.
Coincidence?
Yesterday’s news about Apple shuttering online sales in Russia could have something to do with the decision, but that doesn’t mean the Cupertino giant commissioned this announcement overnight. After all, 2015 is mere weeks away.
Chances are the change had been planned for a while now, but yesterday’s troublesome situation in Russia could have rushed out the email by a few days.
The Apple Online Store remains down as Apple continues to seek solutions to adjust the pricing of its products, but the iOS and Mac app stores are still a go in the country.
Customers will be affected too
This is not the first time Apple struggles with pricing conversions across its various App Stores. Based on each country’s tax laws, the company needs to carefully calculate certain price ranges.
For example, the US App Store doesn’t accept pricing lower than $0.99, which so far has translated into €0.89 across most EU countries, but that figure has fluctuated on several occasions. In the UK, the minimum pricing is £0.69, but this has also fluctuated in the past.
In 2015, customers can expect these figures to go even higher. In some countries, the pricing could actually go down a notch, though we’re not holding our breath for that to happen in more than one or two countries. For some recent developer-centric announcements, see the related stories below.
