Amazon app store taxing for Aussie devs

Summary:Web services and e-commerce giant Amazon has limited the use of its mobile app store, which was launched overnight, to United States customers only. The company has also placed tax restrictions on international developers selling their software through the new platform.

Web services and e-commerce giant Amazon has limited the use of its mobile app store, which was launched overnight, to United States customers only. The company has also placed tax restrictions on international developers selling their software through the new platform.

The store — first flagged back in September — will feature a range of applications for Google's Android smartphone and tablet platform, similar in concept to the search giant's own App Market and Apple's iTunes platform. It has so far been launched for developer access only as Amazon gears up for full commercial launch.

However, the site's website clearly states that like many modern day technology launches, it will only be available initially to residents of the United States. "The Appstore will be available for customers in the United States at launch," it noted.

Amazon does not have a formal Australian presence, despite the large number of local customers of both its e-commerce portal and its web services offerings, but a query has been put to its Australian PR agency as to if and when Australian customers will be supported.

The Appstore guidelines also note that international developers who wish to post their applications in the store will have the amount of tax withheld from their royalties impacted if they do not provide the company with a US social security number or a taxpayer ID number.

The site states that international developers will be subject to US withholding tax — currently 30 per cent of the gross amount of royalties — unless taxation treaties exist with the developer's country, which may reduce the amount. However, even if a treaty is in force, Amazon will require international developers to provide the company with US taxation documentation from the country's Internal Revenue Service.

The situation mirrors a long-running battle Australian developers had fought with Google to force the search giant to allow them to sell apps through its App Market platform. The US and UK markets received the feature early, while other countries such as Australia, Canada, New Zealand and Switzerland had been left out of the loop.

Google rectified the problem in October last year, but never precisely explained why the geographical restriction was in place. It appeared to be related to Google Checkout, the company's online payment processing system.

The lack of Australian support in application stores has remained an issue despite the fact that the nation hosts development studios, which have published some of the most popular mobile apps in the world.

Local gaming company Firemint, for example, has shot to global prominence over the past few years due to the success of its Flight Control and Real Racing games on Apple's iOS platform. The games have now been ported to other platforms such as Android.

In January 2010, the developer noted it had sold 2 million copies of its Flight Control app, costing $1.19, for Apple's iOS platform. The game has appeared on a number of "top 100" paid apps lists around the world, and has held the top spot in some countries, including Australia. Most of the sales at that stage (46 per cent) had come from the US, with Australians contributing 8 per cent of sales.

Topics: Apps, Amazon, Software Development

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