Apple has today sent out an email to iOS developers notifying them of upcoming changes to the pricing on the App Store. According to the email, the pricing of apps and in-app purchases (IAPs) will increase in India, Turkey, and the United Kingdom.
Apple mentions that this price change is due to change in tax laws in the India, Romania and Russia, but it doesn’t mention why the pricing is changing in the UK. It’s likely that Apple is merely adjusting the pricing to be in line with the falling value of the Pound Sterling against the US Dollar.
If you’re in India, here’s what the pricing change means and how it’ll affect you.
According to a recent change in the tax laws rolled out by the Government of India, online services will also now attract service Tax. That means that a Service Tax of 14% as well as Swacch Bharat Cess (SBC) of 0.5% and Krishi Kalyan Cess (KKC) of 0.5% will be applicable on all your online purchases. This change is effective December 1st, 2016, but Apple says that the updated pricing will be rolled out on the App Store over the next 7 days.
iOS apps that were previously priced at Rs. 60 will now be priced at Rs. 80. Here’s a neat table that tells you what the current pricing tiers were like and what the tiers will look like once the updated pricing goes live.
The prices have been increased by ₹20, ₹40, ₹60, ₹50 and ₹100 respectively. Surprisingly, Apple has not increased the Alternate Tier Pricing of Rs. 10 and Rs. 30. The pricing of subscriptions also remains unchanged.
This is an interesting change, and I don’t think that the new tax laws are entirely responsible for the increased prices. The rupee has tumbled considerably since Apple last updated the App Store pricing from ₹55 to ₹60.
US$1 today is about ₹68, which is 8 bucks higher than what the company was charging its customers. If you take today’s pricing adjustment into consideration, ₹68 + 15% tax gives you ₹78.2 — something quite close to Apple’s new price of ₹80. Similarly, $4.99 is about ₹340, far higher than the current price of ₹300, but ₹340 + 15% tax is ₹391, very close to the the new price of ₹400.