Own a mobile phone? Then you’re paying the ‘app tax’. It’s a racket and it’s time the UK faced Apple and Google down | Chi Onwurah
Summary
Apple and Google charge app developers up to 30% commission on sales made through their app stores in the UK. This “app tax” increases costs for developers and consumers because there are no real alternatives to the Apple App Store and Google Play Store on smartphones.Key Facts
- Apple and Google control around 90% of UK mobile device platforms.
- Both companies charge up to 30% commission on purchases made inside apps.
- Developers cannot inform users about cheaper options outside the app stores, a restriction called “steering”.
- British consumers pay an estimated £700 million yearly to Apple and Google from these fees.
- This amount is £232 million more than what these companies paid in UK corporation tax last year.
- Parliament passed the Digital Markets, Competition and Consumers Act (DMCCA) in 2024 to regulate dominant platforms like Apple and Google.
- The Competition and Markets Authority (CMA) has mostly gotten voluntary promises from Apple and Google, not enforceable rules.
- A CMA consultation on allowing “steering” has recently closed, with a decision expected soon.
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