Apple has announced that app prices and in-app purchases on the App Store will increase in India and at least five other countries, including Brazil, Colombia, Indonesia, Russia and South Africa. According to details shared by the company on its developer website Monday, the increase in App Store app prices in India will reflect the new two percent match rate, in addition to the existing 18 percent tax on goods and services. To recall, the offset levy is a form of direct tax that the government introduced in 2016 with the intention of taxing foreign tech companies on income accumulated through digital transactions. In the Finance Act of 2020 that came into effect on April 1 of this year, the government had imposed a 2 percent offsetting tax on e-commerce operators under section 165A. In addition, foreign developers in Indonesia will bear the burden of an additional 10 percent tax, the company added.
Updated prices will be reflected on Apple’s developer portal in the Pricing and Availability section of My Apps once these changes take effect. Changes are likely to occur in the coming weeks. “When taxes or exchange rates change, we sometimes need to update prices in the App Store,” Apple explained on the developer’s website. Once the pricing changes take effect, developers can update app prices and in-app purchase rates (including auto-renewable subscriptions) at any time on App Store Connect. At the moment, it is not clear if Apple’s own services in India, such as Apple Music, Apple TV + and iCloud, would also witness a change in subscription fees.
It is safe to assume that updated pricing details will be passed on to customers once they are in place. Additionally, prices for apps and in-app purchases (excluding auto-renew subscriptions) will also be adjusted in Iceland and Albania to align with prices used in other markets selling in US dollars with value added tax. Apple has also provided developers with updated price level charts to show revised prices for their particular applications. The developer pricing tables highlight that Apple would charge a minimum of Rs. 89 in apps on the App Store. The company last updated App Store pricing in 2017 when the minimum price for apps was set at Rs. 80 in India.
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