iPhone 6: How Much 'Australia Tax' Does Apple Add?

Apple has announced Australian pricing for its new iPhone 6 and iPhone 6 Plus phones. The question inevitably arises: how much more are Australians paying for the new models than US customers?

Picture: Getty Images

An important point first: don't make the mistake of comparing the Australian prices to the headline prices Apple has announced for the US: $US199 (for the 6) and $US299 (for the 6 Plus). That price requires you to sign up for a two-year contract, while the Australian prices are an outright buy, so they can't be directly compared. (Customers who don't want to pay up front in Australia will be able to sign a contract deal with Optus, Telstra, Virgin Mobile or Vodafone, though prices haven't yet been announced.)

While Apple makes less noise about it, it does also offer contract-free outright buys in the US via T-Mobile. We can compare those prices to the local ones by multiplying them by the current conversion rate ($1US is $AUD1.09) and then adding 10 per cent to account for GST. Here's the comparison:

Model AU Price US Price Converted Difference
iPhone 6 16GB $869.00 $649.00 $778.15 $90.85
iPhone 6 64GB $999.00 $749.00 $898.05 $100.95
iPhone 6 128GB $1,129.00 $849.00 $1,017.95 $111.05
iPhone 6 Plus 16GB $999.00 $749.00 $898.05 $100.95
iPhone 6 Plus 64GB $1,129.00 $849.00 $1,017.95 $111.05
iPhone 6 Plus 128GB $1,249.00 $949.00 $1,137.85 $111.15

So Apple is slugging Australians around $100 more than US customers for most models. (US residents would also have to add sales tax, depending on their state, but that figure varies -- so some might pay close to Australian pricing, while others won't.)

This isn't entirely surprising (we also pay more for iTunes App Store apps), and I don't imagine it will stop people from buying the phone in huge numbers. Nor would it be worth importing the US phone, since it will be network-locked and you'd have to pay postage. But it's a reminder that Apple does like to overcharge Australians.

By the way, no word yet on Australian pricing for the Apple Watch (it will be $US349 when it launches next year), so we can't make that comparison.


Comments

    Well im sticking to android even if the iphone 6 has destiny or call of duty AW on it.

      Well actually if you get the Sony Xperia Z3 which is an Andriod phone Sony allow you to use remote play so technically you can play your entire ps4 library on your Andriod phone including Destiny and Call of Duty AW. As long as you have a PS4.

      Also the iphone 6 only has 1GB of ram so no way it would ever be able to handle any games close to those in terms of graphics.

      Unless you meant the companion apps which will probably launch on andriod soon enough but who really cares about those.

    Just as you did for local GST here, you also need to take into account sales tax for the state in the US where the phone was purchased. http://en.wikipedia.org/wiki/Sales_taxes_in_the_United_States#Summary_table

    Last edited 10/09/14 8:02 am

      I was just about to mention this. While they are no doubt cheaper, sales tax in the US is about 10% (depending on state, but it's all around that) so the actual price difference is more like $30-$40, which isn't too bad really (compared to other companies, especially software developers).

        I'm assuming Angus updated the article already...
        If you add 10% GST, that's like the US tax... but adding two lots of taxes for the comparison (which would give you your $30 difference), this is an unfair comparison. I agree with Angus' $100 difference. Unless you can confirm that Apple have to pay a state sales tax if they sell to Australian companies...
        Angus, you did a great job on this article. Thank you!

          The Australian price is GST inclusive, whereas in US you add on top...

        The US doesn't have GST, only state sales tax. The article should be updated to remove the mention of GST, though 10% state sales tax is probably a fair comparison, so the numbers above are not far off.

        actually the average state sale tax is about 7-8% in the US. so for a iPhone 6 + @ $1249 (whereby $1135.45 is cost and $113.545 = GST) and the US Price is $949 + (on average) $75.92 in tax = $1025USD which is converted to AUD $1120.

        the difference is then $129AUD.

        this is roughly 10% higher than the average overall cost to an american buying it contract-free and UNLOCKED (but could be used here in Australia...)

        so the australia tax is pretty much 10% on top of the 10% we're already paying in tax...go figure...

      If only there was a sentence in the article specifically referring to US state sales tax. Maybe they could put brackets around it to make it stand out.

      True -- have updated to mention that.

        Except that your phrasing now suggests to double count the tax. Adding the 10% GST for comparison is correct; saying that "some [US customers] might pay close to Australian pricing" is wrong, since you've already added the 10%.
        More correct is to say that for some US customers the difference is closer to 20% if they buy online from a state that does not have a physical Apple Store or live in a state without a sales tax.

      Individual sales tax for each state is the dumbest shit ever invented. Everytime you see a price you've gotta add more in your head before you decided if it's worth it or not. 99% of the time it still is.

        Or if you're in Alaska, Delaware, Montana, New Hampshire or Oregon pay no sales tax at all!

          Haven't spent much if any time in those states. Family live in NC so visit mainly around that area. Buy 2 years worth of clothes and shoes for next to nothing, its great.

    Thank you for this post, it was very helpful. I'm American, but an Australian resident. And I'm making my annual trip to the US next month so I was trying to weigh up if it was worth buying an iPhone 6 straight out there. I would too if the bloody things weren't locked. But seeing as there isn't much price difference anyway I will be buying it the day it comes out. Now I just need to weigh up the pro and cons for the 6 or the 6plus. Any suggestions? :)

      Depends. Bigger battery and bigger screen? They are both larger and depending on how much of a apple fan you are they are both an abomination to Steve's perfect size.

      Buy whichever one you choose in Australia, then claim the GST refund under the TRS scheme when you travel to the US. Not quite as cheap as buying in the US, but a lot more convenient and cheaper than paying full retail in Australia.
      TRS FAQ here ==> http://www.customs.gov.au/site/page4461.asp

    Taxing taxes/GST into account the conversions seem very reasonable to me.

    Last edited 10/09/14 8:47 am

    So looks like roughly 11%. Take away US sales tax (which generally isn't included in those final US prices), and it's not enough to complain about I think.

    I'll agree. Stop comparing AU price to US. Also compare AU to EU and you will see that there is no difference to pricing there. Specially in electronics, consoles etc, if it costs $300 in US it will cost €300 in EU. Australia pricing is the same as EU. So it's not so "Australia Tax", more like "US discount"..

    just take the 10% off the Australian price, and then compare it to the US price with exchange rate conversion, works out the iPhone 6+ is cheaper in Oz.

      . . . unless you do your calculations right, which is what Angus did.

    Australians will still pay a premium if they sign up for a 2 year contract. Most aussies who can't front the $869+ straight up will go on a 2 year plan paying off the the handset at the same time. They will still be slugged the same amount or more by the communications companies not a rate comparable to the $199 or $299 the yanks are on.

    I'm more annoyed by the fact they are so expensive in the first place. Forget the Australian tax, this is straight up, undiluted Apple tax. When most other flagship phones (even massive ones like the Note or Z series) are all priced around 800... why are we paying 1000 for the BASE version of the 6+?

    A 64gb iPhone 6 on US apple site sells for $299usd and here in aus sells for $999, that's 700 diffefence' even taking out the tax bullshit, its still 500-600 difference.
    WTF

      Read the post -- it points out that the $299 price is a contract deal, not an outright buy of an unlocked phone.

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