Apple and Google are generating significantly more revenue from British consumers through fees on app purchases and subscriptions than they contribute in corporate tax, according to recent analysis. This so-called "app tax," a commission fee of up to 30 percent charged to app developers, is estimated to bring in around £700 million annually for the two companies combined.

The analysis compared this income to corporation tax payments made by the tech giants, which amounted to £322 million from Apple in 2025 and £146 million from Google in 2024, based on the most recent available accounts. While the fee is formally paid by app developers—including popular services like Tinder and Hinge—advocates argue that the cost is passed on to consumers. It is estimated that this surcharge adds approximately a third to the price of certain digital services, equating to about £55 per year for a household with four smartphone users. Projections suggest this burden could rise to £1.2 billion in five years, or roughly £91 per household annually.

Over the next five years, the "app tax" is forecast to cost UK consumers an estimated £4.1 billion. The study found that for every £1 Apple and Google pay in corporation tax, consumers are charged about £1.50 in fees via in-app purchases.

Former Conservative tech minister Damian Collins stated that these figures illustrate how the companies extract value from UK taxpayers while paying comparatively less tax than other domestic businesses. He called for regulatory action to establish a more equitable environment that prevents both overcharging consumers and underpayment of taxes by tech firms. Similarly, Dominic Fean from the Coalition For App Fairness (CAF) argued that the current app store model is detrimental to the UK economy, as Apple and Google generate more profit from fees than their corporate tax contributions.

The Competition and Markets Authority (CMA) has suggested that Apple and Google’s fees may not be “fair and reasonable” and launched a consultation in June on measures to address the issue. Proposals under consideration include requiring the companies to allow app developers to offer alternative, cheaper payment methods outside of the app stores. This could enable consumers to avoid the commissions and potentially save billions of pounds over time. The consultation closed at the end of July, with a regulatory decision expected later this year.

Apple charges a standard 30 percent fee for in-app purchases, though it offers a reduced 15 percent rate for smaller developers earning less than £740,000 annually. However, critics maintain that the fees remain too high and that users are generally unaware they might find lower prices elsewhere due to Apple’s restrictions on apps providing links or other alternative payment options. Companies are currently prohibited from directing iPhone users to external payment methods such as QR codes or web links, requiring all transactions to go through Apple’s payment system.

Google’s Play Store fees can reach about 25 percent, but the company has loosened some restrictions, allowing developers to link users to cheaper deals outside the app in certain cases.

The Digital Markets, Competition and Consumers Act 2024 granted the CMA powers to cap fees and fine companies that do not comply with regulations. However, the consultation stopped short of proposing fee caps, instead focusing on enabling consumer access to cheaper payment choices to promote competition.

Both Apple and Google asserted that they pay all taxes legally due. Apple noted that only about 15 percent of developers are subject to the higher fees, with most paying the reduced rate. A spokesperson also claimed that the Coalition for App Fairness represents a small group of developers opposing payment for the benefits they receive from Apple’s platform and technology, arguing it is not representative of the broader developer community.