iPhone 14 prices in the UK and other countries are not due to Apple

Much has been expressed about iPhone 14 prices in the UK, EU countries and elsewhere. Many argue that prices in other countries are much higher than in the US, accusing Apple of inflating prices.

But while the price of the iPhone 14 and other Apple products in many countries is indeed dazzling, it’s not because Apple is trying to make more money…

Apple’s US prices are misleading

First, we should note that the top prize shown in the US Apple Store is not the one most Americans pay: they have to pay sales tax on top of that. Only a handful of US states have no sales tax, allowing residents to pay the nominal price.

The reason Apple shows the tax-free price is because the percentage varies by state and because Americans are used to seeing tax-free prices.

Sales tax is included in UK and EU countries

The UK and EU countries also have sales tax in the form of VAT, of course.

But the big difference here is that there is VAT including in the price shown. In most countries, consumers** expect to pay the displayed price. Consumers wouldn’t be impressed with Apple if they checked out and the company added another 20%.

This explains most of the price difference

Let’s take the example of the base model iPhone 14.

Crazy, right?

Except that of that £849, £141.50 of it is sales tax (VAT). So subtract that to get comparable prices to US list prices:

  • Actual iPhone price: £707.50
  • Dollar Equivalent Price: $819
  • Difference between US and UK prices: $20

So yes, UK customers pay more than US buyers – but only $20 more, not $129 more.

You can make similar amounts for other countries where sales tax is included in Apple’s prices.

Some countries also have import duties

Some countries charge Apple a percentage of the sale price as an import tax.

We saw the example of Turkey before, where the same base iPhone 14 costs the equivalent of $1,700, or more than double the price in the US. But again, most of the difference is tax. Turkey applies technology taxes of about 90% to imported consumer electronics. For the rest, the Turkish currency is depreciating so fast that Apple has to hedge its bets and pick a price that it can hold for quite some time.

But have the prices not increased much compared to last year?

Yes, but that’s because there’s been a massive shift in exchange rates.

The US dollar is currently incredibly strong, meaning it takes more pounds, euros, and so on to buy the same amount of dollars.

As we saw in the UK example, the actual currency conversion is pretty much the same: the dollar is simply stronger against the pound than last year.

High iPhone 14 prices are real, but not Apple’s fault

Don’t get me wrong, as a Brit, the price increases are just as painful for me as they are for the rest of you (okay, not Turks).

But if we want to get annoyed with prices, blame the governments that impose sales taxes, and forex investors that retreat to the dollar’s safe haven when the world looks fiscally precarious, making it more expensive to buy. Apple is only on the hook for a few bucks.

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