Price rises hit Apple's App Store in Europe, Canada, and Russia

Apple is raising prices across Europe as it shifts to VAT based on the customer's country of residence. For Russia, the price hike could be linked to the fall in its currency.

Apple has told developers it's raising App Store prices across Europe, Canada, and Russia in response to new tax laws and changes in foreign exchange rates.

While Apple earlier this week boasted of the billions of dollars it helped developers earn last year, the company also quietly told app makers it was planning to raise prices for all countries in the European Union, including Norway, by the end of the working week. Prices are also set to go up in Canada and Russia, while app costs in Iceland are set to decrease.

News of the change came by way of an email to developers in Apple's iTunes Connect program, first reported by Apple Insider.

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"Prices on the App Store are changing to account for adjustments in value-added tax (VAT) rates and foreign exchange rates," an Apple spokesperson said.

Late last year, Apple flagged changes to the way VAT is applied to apps. From the start of 2015, VAT levels for apps began to be based on buyers' country of residence, rather than Apple's previous practice of applying a lower flat rate across the continent, tied to Luxembourg's VAT. Again, it notified developers of the upcoming changes but not customers.

The change to Apple's VAT pricing reflects new tax rules ushered in on January 1 as part of an effort to stamp out the practice of global companies shopping around between various European countries to find the best tax rate.

Companies are responding differently to the new EU rules, which affect apps, e-books, and movie-streaming services. As the New York Times noted last year, Amazon said it wouldn't raise the cost of Prime membership but didn't comment on the future price of e-books.

Microsoft has clarified that it will be changing prices for Skype as of January 1, 2015 to fall in line with per-country VAT rates, rather than the flat 15 percent VAT it previously used.

Meanwhile, the price changes in Russia would appear to be linked to the recent volatility in the ruble, which prompted Apple to suspend sales and then raise prices of products like the iPhone by 35 percent.

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