Apple Has Announces App Store Pricing and Tax Changes – Impact on Indian Developers
The Apple has announced updates to App Store pricing and developer earnings, affecting various regions due to changes in taxation policies and currency fluctuations. While these updates primarily impact countries like Azerbaijan, Peru, Slovakia, Estonia, and Finland, Indian developers should also stay informed about potential implications.
Key Changes Effective from February 6, 2025:
Apple has adjusted its tax policies and pricing models for certain regions:
- Azerbaijan & Peru: Introduction of an 18% Value-Added Tax (VAT).
- Slovakia: VAT increase from 20% to 23% (except for ebooks, which will have a reduced 5% VAT).
- Estonia: Tax on digital news publications and magazines increased from 5% to 9%.
- Finland: VAT on ebooks raised from 10% to 14%.
Apple will handle tax collection and remittance in these regions, similar to its approach in India, where it already collects and remits GST (Goods and Services Tax) on App Store purchases.
Changes in App Store Pricing from February 24, 2025:
If your app’s pricing is based on the Azerbaijan or Peru storefront, Apple will automatically adjust prices to reflect the new VAT rates. However, developers using a custom pricing model will not see any changes unless they manually update their pricing.
For Indian developers, these adjustments don’t directly impact pricing in the India storefront. However, global pricing shifts could influence foreign transactions for Indian developers catering to an international audience.
Impact of Japan’s New Tax Law (Effective April 1, 2025):
Japan has implemented a new taxation model for international developers selling digital products in the country. Starting April 1, Apple will collect and remit a 10% Japanese Consumption Tax (JCT) on behalf of developers based outside Japan.
Indian developers who offer paid apps or in-app purchases in Japan should note that this tax will automatically be deducted, impacting their revenue from Japanese customers. If your app operates a prepaid coin-based system, any prepaid items purchased before April 1 will not be affected.
How Indian Developers Can Adapt:
- Monitor Price Adjustments: If your app is available globally, check App Store Connect for automatic price changes in affected regions.
- Consider Custom Pricing: If your app has a significant user base in Japan or other affected regions, you may want to adjust your pricing manually.
- Stay GST-Compliant: In India, Apple already includes GST in App Store transactions, so ensure your tax filings align with these updates.
