The festive season is round the corner, and tech powerhouse Apple is celebrating it by hiking the prices of apps and in-app purchases on its App Store. This rise in prices will be effective across several markets in both Europe and Asia (and even some countries in South America and Africa).
The new rate of prices will be effective starting October 5, 2022. Once the date comes along, users in Chile, Egypt, Japan, Malaysia, Pakistan, Poland, South Korea, Sweden, Vietnam, along with all territories that use the Euro will be affected by the new price rates in the apps and in-app purchases alike.
This means that for users in the territories that use Euro, apps and in-app purchases that were formerly priced at €0.99 and €9.99 will now cost €1.19 and €11.99 respectively. The hike is more than 30% in Japan and 20-25% in South Korea.
This is the second instance of Apple announcing and implementing a change in prices of in-app purchases for its App Store in as many years. It had brought about changes to the same prices of apps and in-app purchases (excluding auto-renewable subscriptions) in August 2021 – the prices decreased in South Africa, UK, and all territories using the Euro currency, while prices rose in Georgia and Tajikistan.
Once the new (and higher) prices are effective, the Pricing and Availability section of My Apps will be updated. Once that is done, developers can change the price of their apps and in-app purchases (including auto-renewable subscriptions) at any time in App Store Connect. Those offering subscriptions can choose not to hike the rate and instead keep the prices same for their existing subscribers.
In Vietnam, the hike in the prices will reflect new regulations for the company to collect and remit applicable taxes – VAT and CIT – both at a rate of 5%.
In an update, the iPhone maker informed that the proceeds of developers will be adjusted accordingly and will be calculated based on the tax-exclusive price. Exhibit B of the Paid Applications Agreement would be updated to indicate that Apple collects and remits applicable taxes in Vietnam. This is due to new local tax regulations.
While Apple did not offer any reasons as to why it was taking this step, it is likely that it is possible that the exchange rate of local currencies, and the weakening of some currencies owing to rise in inflation, against the dollar is a factor. Throughout 2021, the US dollar has gained value against the Euro as the latter fell to its lowest in two decades, and currently, the value of 1 Euro is equal to $1.