Apple has announced that it will be adjusting its pricing for apps and in-app purchases in Egypt, Tanzania, and Nigeria, starting from July 25th, 2023. These changes are expected to have an impact on both developers and consumers in these African markets. While Apple did not explicitly state whether the adjustments would result in higher or lower prices, the reasons cited for the update include tax regulations, foreign exchange rate adjustments, and the implementation of Value Added Tax (VAT).
Apple claims that it is revising pricing in the affected countries to reflect recent changes in tax laws and foreign exchange rates. Tanzania had implemented an 18% VAT plus a 2% digital tax, while Egypt had instituted a 14% VAT. The company in a statement said:
“When tax regulations or foreign exchange rates change, we sometimes need to update prices on the App Store in certain regions and/or adjust your proceeds. These updates are done using publicly available exchange rate information from financial data providers to help ensure prices for apps and in‑app purchases stay equalized across all storefronts.”
Apple further explained “If you’ve selected Egypt, Nigeria, Tanzania, or Türkiye as the base storefront for your app or in‑app purchase (excluding auto‑renewable subscriptions), the price won’t change on that storefront. Prices on other storefronts will be updated to maintain equalization with your chosen base price. If the base storefront for your app or in‑app purchase (excluding auto‑renewable subscriptions) isn’t Egypt, Nigeria, or Tanzania, prices will increase on Egypt, Nigeria, and Tanzania storefronts.”
What this Means for Apple Developers and Customers in these Markets
For Apple developers in Nigeria, these pricing revisions will necessitate some adjustments. The prices of their apps and in-app purchases may need to be altered to comply with the new tax laws and exchange rates. This could potentially lead to increased prices for consumers in the region. However, it's worth noting that if developers have auto-renewable subscriptions or manually manage prices on specific storefronts, their prices will remain unchanged.
Furthermore, the changes in pricing may also affect the proceeds and tax administration for developers in Nigeria. The earnings from sales of apps and in-app purchases, including auto-renewable subscriptions, will be adjusted to reflect the new tax rates and updated prices. While Apple explicitly mentioned Egypt and Tanzania as markets where they will directly collect and remit applicable taxes, it remains unclear whether the same will apply to Nigeria.
Nevertheless, developers in Nigeria will still retain the ability to manage the prices of their apps, in-app purchases, and auto-renewable subscriptions at any time through the Pricing and Availability section of App Store Connect. This provides developers with some flexibility in adapting to the new pricing structure and tax regulations.
As for customers in Nigeria, they can expect to see changes in prices when purchasing apps and making in-app purchases on the App Store. It's important to note that these adjustments will not impact auto-renewable subscriptions. Therefore, users who engage in these subscription-based services will not experience any changes in pricing.