Closing A Tax Loophole May Result In UK Customers Paying More For Apps

(Credit: Getty Images)

(Credit: Getty Images)

Have UK Apple users seen the end of 69p app downloads?

Britain’s Chancellor of the Exchequer George Osborne has closed a tax loophole, which may result in iTunes and App Store prices in the UK rising by as much as 20% from 2015. The loophole meant that international companies including Apple were able to sell digital content in Britain through Luxemburg, where tax is as low as 3% — compared to the 20% it is charged at in the UK.

While around £300 million is expected to be saved from the move, it is bad news for individual users, who will likely see the minimum price of apps rise again — as they did in 2011 when they increased from £0.59 to £0.69.

The change is set to come into effect from Jan. 1, 2015. Apple has yet to officially respond to the news.

About the author

Luke DormehlLuke Dormehl is a UK-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Formula: How Algorithms Solve All Our Problems, And Create More and The Apple Revolution, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme, and other publications. He'd like you a lot if you followed him on Twitter.

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