Apple to soon start demanding 30% tax from Meta for Advertisements

New modifications requiring iOS developers to give Apple a 30% cut on the purchase of "boosts" for postings in a social media app have escalated the Apple-Meta conflict over the…

By Nivedita Bangari

October 27, 2022

2 min read

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New modifications requiring iOS developers to give Apple a 30% cut on the purchase of “boosts” for postings in a social media app have escalated the Apple-Meta conflict over the App Store. According to The Verge, the change will have an impact on Facebook and Instagram where users can pay to increase the reach of their postings. Additionally, it is the first time Apple has explicitly taxed app advertising.

“Apple continues to evolve its policies to grow their own business while undercutting others in the digital economy,” a Meta spokesperson was quoted as saying in the report late on Tuesday.

Apple had previously stated that it didn’t take a cut of developer advertising sales, but it has “now apparently changed its mind.”

“We remain committed to offering small businesses simple ways to run ads and grow their businesses on our apps,” said Meta.

All of the apps in the Meta family as well as Twitter and the Chinese short-form video site TikTok allow users to pay to enhance their postings. A spokeswoman for Apple told The Verge that the App Store has long taken a cut of digital products and services.

“Boosting, which allows an individual or organization to pay to increase the reach of a post or profile, is a digital service — so of course In-App Purchase is required. This has always been the case and there are many examples of apps that do it successfully,” the Apple spokesperson was quoted as saying.

The App Tracking Transparency (ATT) privacy modifications made by Apple in the App Store have already boosted its advertising revenue and allowed the iPhone manufacturer to end the Facebook-Google advertising monopoly in the internet search market.

Mark Zuckerberg, founder, and CEO of Meta has acknowledged that Apple’s modifications to iOS privacy settings will cost the business a staggering $10 billion by 2022. Meta has asserted that Apple’s privacy restrictions favor Google over app-based platforms like Facebook. An ATT feature included in Apple’s iOS 14.5 version, which was made available in April 2021, had an impact on tech companies’ digital advertising.

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