But “the levy in question only included computers with internal storage of 40GB or higher… ‘We found out this weekend that iPad is not subject to a new German copyright tax that we previously thought it was subject to,’ Jobs wrote in [a later] response,” Starrett reports. “As a result, the 16GB and 32GB iPad with Wi-Fi models are now priced at €499 and €599, respectively, in Germany, while 16GB and 32GB Wi-Fi + 3G models are priced at a €100 premium; pricing on 64GB models, which are subject to the levy, remained at €714 for Wi-Fi only models and €814 for Wi-Fi + 3G versions.”
Full article, with links, here.
Eric Slivka reports for MacRumors, “With Apple’s announcement on Friday regarding availability of the iPad in nine new countries later this month, a number of potential customers expressed dismay at the apparent higher prices in those countries relative to those in the United States. Several of those customers took the time to email Apple CEO Steve Jobs with complaints on the issue, two of whom shared his identical responses with us. ‘Please educate yourself. UK prices must by law include VAT, which is around 18%. US prices do not include tax.'”
“Value added tax (VAT) is similar to the sales tax that is familiar to most residents of the United States, but is applied uniformly throughout the country for a given type of item and is included in the advertised pricing,” Slivka reports. “Sales tax in the United States is not included in advertised pricing, as it varies significantly by region, even down to the municipality level.”
Slivka reports, “The standard VAT rate in the UK is 17.5%, meaning that the £429 base price for the 16 GB Wi-Fi iPad in the UK is actually only £365 in ‘pre-tax’ pricing. At current exchange rates, this corresponds to approximately $540 in the United States, or an approximately $40 premium for U.K. customers. While the price difference is not insignificant, it is considerably smaller than it might appear at first glance.”
Read more in the full article here.
rip off britain
as usual
Nice education article; hopefully people will also realize that it applies to Macintoshes and iPods too…
-hh
I see so many complaints on pricing because of the currency exchange.
Tell me this my friendly Brits, when the table is turned and the dollar becomes strong again, will you demand for Apple to raise your prices to “keep it fair.”
> Please educate yourself…
LOL at great Steve Jobs response.
Bob’s right, the currency fluctuations are the biggest problem for Apple (and other), in NZ we have far greater differences in our pricing, but we too have GST (a VAT) & our dollar fluctuates often. So Apple would need to set pricing at some midpoint & then ride out the losses when the NZ$ rises.
Obama wants VAT for US too
Idiots.
They had higher prices than in U.S. all the time. And only now they complain.
@Bob
when the dollar becomes strong again ? the dollar IS currently strong against the pound, we were getting $2 to £1 but now just $1.5. So to answer your question, when the pound gets stronger – YES – we will want lower prices, thanks. Now go and “educate yourself” – Bob.
In other words, get your head out of your ass before you email Jobs, morons.
So why the big difference in Canada, our tax is not included in the price, our Dollar is virtually the same (3 or 4 cents). I wanted to get the 64GB WiFi & 3G plus a case but the price disadvantage ate up the case.
the (VAT free) difference of a 16GB wifi model between US & UK is £26. HOWEVER, a 64GB 3G model has a £43 premium.
Septic tanks, work out the dollars for yourselves.
So if the Germans have to pay a copyright levy on computers, that means they get to download whatever they want, right? I mean, they’ve already paid the copyright levy! There’s no way it would just be a government-mandated welfare package to prop up a struggling industry, is there?
Steve should just say…
Just buy it in the US and leave me alone!
@ Jeff
Please educate yourself re currency changes.
The Canadian dollar can swing 5% or 10% in a matter of weeks or months.
For example: the Canada currency was at par with USD a few weeks ago and with the problems in Greece the CAD dropped by almost 5% in days. Now it is going up again. The last time our CAD was actually over par (a few years ago) it dropped 15% to USD because of economic panic and the flight to the “safe” American dollar.
Apple has to build a currency hedge into the price of their products here in Canada ( as I do in my business ) because an economic problem somewhere else in the world can reduce the value of the CAD almost over night.
RLG
VAT will be here the USA as soon as ‘The Big ‘0’ (zero) can get the proletariate looking the other way. Add 20% to everything you buy.
@ron: please take your lack of education and move to another country.
Now ron’s looking like an extreme fascist with every post, no doubt he just took delivery of some black shirts.
But hey, just because I’m paranoid, does not mean they’re NOT out to get me! … right?
If you keep going so extreme right ron you will meet the peeps going extreme left… and sooner than you think.
whoops silly me, you don’t think.
Euros, buy yours quick, as VAT will rise to cover the bailout of the anarchist Greeks… followed by Spain and Portugal.
@RickG: The Canadian dollar was at or above par several days within the last 30 and never dropped below $0.9581 over the same period. You’re exaggerating.
http://www.bankofcanada.ca/en/rates/exchform.html
The iPad should be priced the same in Canada as it is in the U.S.A.
@ Don,
The Canadian dollar was 5% off it’s high the previous week on Friday. That’s currency volatility. Apple adds $50 to every iPad and $100 to most Macs to hedge against that volatility. The percentage you pay is less the more you pay for the device in question. That’s a break. They could be just adding 5% to every price point.
@ron,
Geritol. It helps; ask my grandma.
@Don
Please read my post again. I also gave the example of currency volatility during the past recession.
You have a short memory. Remember the recession of 2008 and 2009. You should actually read the Bank of Canada data link you supplied. Our Canada Dollar went from almost 10 cents over par to almost 20 cent below the US dollar in a very short time for any company doing business in North America
USD to CAD October 2008 @ 1.2165
USD to CAD November 2008 @ 1.1875
USD to CAD December 2008 @ 1.2377
USD to CAD January 2009 @ 1.2107
With Exchange rates like these what would the iPad cost in Canada. 499USD x 1.21 = $603.79 CAD
Do I exaggerate….this was just over a year ago.
And BigAl was half right. Apple or any US company should build in a hedge of at least 10%. 499USD x 1.10 = 548.90.
Just when the economists tell us that the Canadian dollar is going to be at par with the USD forever, something happens in the world or the banking system to devalue it by 5% to 15%.
And you still think that Canadian prices can be the same as US prices. Look up the definition of “hedge”
RLG
best
best
I don’t get this guy’s logic. How can you compare the post-tax price in the US with the pre-tax price in the UK?
As usual we’re getting ripped off in the UK. While Americans pay $499 including sales tax for an iPad we pay $635 for the same device including VAT.
Grrr!
@MindPower
The US $499 is the price excluding tax. As the article states, sales tax in the US varies by state and then cities can add their 1-2% on top (when I lived in New Orleans sales tax was 8.75%.
And don’t forget that the product still has to be shipped and imported into the UK. I’m guessing it cost a little more to ship from place of manufacture to the UK than to California (for example). Then add the import tariff costs.