(By You Yunting) At the end of 2025, I was still thinking on the question: “Global regulation is forcing down Apple Tax—why is China the exception?” Unexpectedly, just a few months later, in March 2026, Apple made a historic adjustment: it dropped standard App Store commission rate from 30% to 25%, and lowered the commission rate for small business and mini apps partner programme from 15% to 12% in China. However, compared with more open ecosystems such as the EU and Japan, China still maintains a closed ecosystem, and its commission rates are not yet optimal. The following examines the real significance of this commission rate cut and whether there is still room for further reduction.
I. Interpreting AppleTax Reduction Statement
First, what is commonly referred to as the “Apple tax”? For years, Apple’s iOS ecosystem has operated under several core rules: mandatory use of Apple’s in-app purchase (“IAP”) system; prohibition of third-party app stores; and restrictions on external payment links. These rules allow Apple to impose a uniform commission on digital transactions, which developers cannot bypass.
Apple’s statement on the commission adjustment reads: following discussions with the Chinese regulator, Apple is making changes to the App Store in China…We are committed to terms that remain fair and transparent to all developers, and to always offering competitive App Store commission rates, no higher than overall rates in other markets, to developers distributing apps in China.
This statement reveals several key points: first, the reduction was not voluntary, but driven by regulatory engagement; second, Apple only commits to rates in China “no higher than overall rates in other markets”, by which Apple believes its commitment will be fulfilled as long as rates in China are not the highest throughout the world; third, there are still no third-party app stores or alternative payment systems in China, which means, unlike in the EU, Japan, or even the U.S., Chinese developers have no alternative but to charge through Apple’s IAP System.
II. Where Does China Stand After the Adjustment?
To answer this question, it is necessary to compare the commission rate structures of major markets. Importantly, comparing nominal rates alone is misleading due to different degree of openness in the markets—the key metric is the optimal rate available to developers.
1. U.S.: The Epic Antitrust Lawsuit Broke the Control of U.S. Apple Tax
In the United States, reform was driven by the five-year antitrust battle between Epic Games and Apple. In August 2020, Epic introduced a direct payment option in Fortnite, bypassing Apple’s IAP system. Apple immediately removed the game, and then Epic filed an antitrust lawsuit, seeking to break Apple’s control over app distribution and payment.
In September 2021, United States District Court for the Northern District of California rendered a first-instance judgment, ruling explicitly that Apple shall not prohibit developers from directing users to alternative payment methods by in-app links. This created the first opening to bypass Apple’s payment system. However, when implementing the court’s injunction, Apple imposed restrictive conditions that for purchases made via third-party payment methods, Apple would still charge developers a commission at 27% of that external payment. This rate was nearly identical to the standard rate, rendering third-party payment methods effectively useless. Furthermore, Apple implemented cumbersome warning pop-ups suggesting that external payment is risky, which sparked strong dissatisfaction from Epic and the court.
In 2025, the court found Apple in contempt of court for these practices and required it to abolish its commission on external payment and remove the warning pop-ups. Subsequently, Apple introduced a Technology Management Fee, claiming reasonable compensation for providing development tools, technical support and ecosystem services. The legality and rate of this Technology Management Fee remain under dispute. At present, U.S. developers still enjoy a “zero rate” for external payment.
2. EU: the Digital Markets Act Forced Apple to Concessions.
In the EU, changes have been driven by collaboration of legislation and the industry. With the EU’s Digital Markets Act (“DMA”) taking effect in March 2024, Apple was designated a gatekeeper and forced to allow side-loading, third-party app stores, and third-party payment systems. This marked the first time in the world that legislation mandated Apple to open its closed ecosystem. Alongside the DMA, companies like Spotify continuously filed complaints against Apple. In April 2025, due to complaints by Spotify, the EU fined Apple €1.84 billion for abusing its dominant position in the music streaming market. This “one-two punch” of legislation and enforcement forced Apple to make substantive concessions in the EU.
Apple’s adjustment in the EU included lowering nominal commission rate from 30% to 17%, and the discounted rate for small developers from 15% to 10%. However, while opening third-party channels, Apple also introduced a Core Technology Fee, later renamed the “Core Technology Commission”, charged at 5% of the transaction value. This has sparked widespread controversy, with critics viewing it as a disguised means for Apple to maintain its revenue. The opening of Apple’s ecosystem in the EU does not grant developers complete exemption from Apple tax, but instead brings about a more complex billing system.
3. Japan: Legislation Mandated Apple to Open the Japanese iOS Ecosystem
Japan has taken a legislative approach similar to that of the EU. On December 18, 2025, Japan officially implemented the Mobile Software Competition Act (“MSCA”), requiring Apple to permit third-party app stores and non-Apple payment channels. Apple subsequently adjusted its policies, though the market response of these changed policies has been lukewarm.
On paper, Japanese developers now enjoy rights comparable to those in the EU. However, Apple has also introduced a “Core Technology Commission” at 5% for the Japanese market. This means that even if developers has distributed their apps and made charges via third-party channels, they are still tethered to a basic fee of 5% to Apple.
More critically, the standard commission rate in Japan was only reduced from 30% to 26%—a drop of just 4%, which is lower than the drop of 5% in China. This policy design significantly weakens the actual cost advantages of third-party channels. For example, for an app with an annual revenue of 10 million yen, if it is distributed via App Store and uses Apple’s payment system, the commission will be 2.6 million yen; if it opts for a third-party channel, the developer will pay 0.5 million yen in Core Technology Commission plus third-party payment fees (typically 3%-5%), making the total cost roughly comparable.
The above analysis shows that although China’s nominal Apple tax is close to the average of major global markets, it remains the most disadvantaged position regarding alternative payment channels. Developers in the EU, U.S. and Japan have the right to choose third-party app stores and payment systems. For example, U.S developers using in-app third-party payment methods currently enjoy a zero rate (though Apple may be allowed to charge a fee in the future); developers in the EU and Japan only pay an Apple tax at 5% if their apps are downloaded via third-party app stores. Thus, in terms of the minimum rate actually available to developers, China’s Apple tax may still be the highest.
III. Why Further Reduction of Apple Tax in China Are Unlikely?
Undeniably, reducing Apple tax from 30% to 25% is a tangible benefit. However, objectively speaking, the current rate is still high. Can it drop further in the future? I believe it is very difficult because the common factor in the rate drop in other markets is the persistence of competitive pressure, which is missing in China.
Globally, the drop in Apple tax has been driven by legislation (EU, Japan) or litigation (U.S.), rather than Apple’s proactive concession. Making laws to reduce Apple tax or winning an antitrust lawsuit against Apple only triggers a new round of strategic interactions with Apple. Due to Apple’s continuous efforts to create obstacles in various ways, it requires strong regulatory determination and persistent legal pressure at any cost from stakeholders like Epic and Spotify to push for substantive change. However, China currently lacks both.
Now in China, anti-trust legislation and enforcement have focused on the platform practices of exclusive dealings (one or the other), algorithmic recommendation and data compliance. While the commission structure of app stores has received attention, it has not yet become a core focus of antitrust enforcement. Moreover, no stakeholders in China comparable to those in the EU and US tend to initiate an antitrust litigation: Epic reportedly spent over $100 million on legal fees, and Spotify completely shut down Apple’s IAP channel on iOS even if app updates were refused by Apple. By contrast, no domestic tech company is willing to directly confront Apple regardless of cost.
It’s not that Chinese developers aren’t dissatisfied with Apple tax; rather, the practical game structure is entirely different. When a domestic developer initiates an antitrust lawsuit, Apple’s usual strategy is to settle quickly to satisfy the plaintiff’s specific demands in exchange for a withdrawal if the situation is believed to be unfavorable to Apple after risk assessment. Developers, for their part, are often unwilling to offend the platform since their business must continue. This “private settlement” model neither creates public judicial precedents nor drives systemic policy changes.
Consequently, the reduction of Apple tax in China can only rely on regulatory intervention, rather than market competition or judicial rulings. In this condition, the new rate is essentially a negotiated outcome after regulatory bargaining, not naturally stemming from the competitive environment.
Ultimately, 25% will likely remain the “new normal” for Apple tax in China for a long time. More substantive concessions can only be witnessed through further regulatory intervention or fundamental changes in the market landscape—such as the rise of the HarmonyOS ecosystem providing an alternative to Apple—which, for now, remains a distant prospect.
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