Small developers operating outside Japan may have difficulty contacting them to pay their delinquent consumption taxes, so the Ministry of Finance has put the burden on Apple and other app market operators. Japan's mobile app market (such as Apple's AppStore) continues to grow, which means an increasing amount of income subject to tax. However, it is difficult for Japan to tax every sale.
According to Nikkei Asia, Japan’s Ministry of Finance will require app store operators such as Apple and Google to pay the consumption tax owed by foreign developers. The changes won't take effect until 2025 to give companies time to adapt.
The purpose of this is to let Apple and Google know how much money their respective app stores make in Japan. Therefore, the two companies will know how much consumption tax is owed to Japan and pay it in full.
The current consumption tax is 10%, and Apple will pass this tax on to developers. So, for example, in addition to Apple's 15% to 30% share of revenue from App Store sales and subscriptions, Apple will add 10% to that to cover Japan's consumption tax.
In this way, developers need to adjust prices to cope with price increases. Some developers already pay their taxes appropriately, so it won't affect their annual income.
Apple has been fined for mishandling excise taxes. In 2022, Apple was fined $98 million for incorrectly exempting tourists and resellers from consumption tax.