Apple plans to modify its in-app purchase system in Nigeria, Egypt, and Tanzania due to an upsurge in taxes.
Starting from July 25, 2023, Apple will implement pricing changes for in-app purchases made through the App Store.
These adjustments will impact both app developers and users in the three African markets mentioned. Apple did not specify whether the changes would result in higher or lower prices.
However, the reasons cited for the modifications, including the implementation of Value Added Tax (VAT) and increased taxes in the affected countries, imply that prices will likely increase.
Apple stated that the price updates are in response to recent changes in tax laws and currency exchange rates in the countries involved. Notably, Tanzania has introduced an 18% VAT along with a 2% digital tax, while Egypt has implemented a 14% VAT.
Under the 2021 Finance Act, offshore companies operating in Nigeria are required to pay a 6% tax on revenue generated from digital services, such as apps, high-frequency trading, electronic data storage, and internet advertising, provided to local clients.
The company clarified that if Egypt, Nigeria, or Tanzania is selected as the base storefront for an app or in-app purchase (excluding auto-renewable subscriptions), the price will remain unchanged on that specific storefront. However, prices on other storefronts will be adjusted to maintain consistency with the chosen base price.
Furthermore, Apple has updated the Pricing and Availability section of My Apps in App Store Connect to reflect these impending price alterations. App developers always have the option to modify the cost of their apps, in-app purchases, and auto-renewing subscriptions.
By Elijah Christopher
