The music and podcast streaming platform Spotify informed its customers that it will increase the price of their subscriptions in Argentina by up to 50%. Through emails, the service communicated that it will apply the increases from next April 30. Spokesmen for the firm mentioned inflation as the cause of the adjustment.
As the company informed users of the basic plan, the price of the Premium Individual service -the cheapest of those offered by the company within the paid options- will go from $ 139 to $ 199, a rise of 43% for the most basic package that it is intended for a single user.
At the other extreme, meanwhile, the family premium plan will increase from $ 239 per month to $ 359 per month, a 50% increase from the previous price.
“In Argentina we adjust prices as a result of inflation, taxes or other macro factors; our previous price increases in 2020 and 2019, and this current price increase, must take into account the inflation in the market ”, said company spokespersons to Infobae.
“As we continue to innovate and invest to provide our listeners with greater value than ever, we occasionally update our prices. We can also increase prices as a result of macro factors, in this case inflation ”, he added.
The company is confident that, despite the price adjustment, they will not suffer loss of users. “We are committed to delivering the best audio content around the world, and we are always working to provide our users with more original and exclusive content, a highly personalized experience, and powerful discovery tools.
“The results of previous price increases indicate that in the markets where we increased prices, users believe that Spotify continues to be an exceptional value and have shown a willingness to pay more for our service,” he said.
“In Argentina we adjust prices as a result of inflation, taxes or other macro factors”
With the adjustment, the international company recomposes the cost in dollars of its service, badly hit by the advance of the different prices of the currency in the last year. In the last year, the official dollar increased 40% in the wholesale exchange market. The free dollar, on the other hand, gains 30% in the same period.
Thus, a year ago the monthly payment of $ 139 represented a value of USD 2.09 at the official exchange rate of the moment. Today’s $ 199 individual premium plan, meanwhile, is about $ 2.13 at today’s exchange rate. Until now, these users had been paying USD 1.49 per month measured at the official wholesale exchange rate.
For reference, in the United States the individual plan is at USD 9.99, the duo USD 12.99 and the family plan is USD 14.99 per month.
The prices in pesos reported by the company, however, are not the final cost paid by the user. They are “prior to taxes”, with which, depending on the district in which each user lives, must apply above 21% VAT, 8% PAIS Tax, 35% withholding on account of Profits, 1.2% tax to the Stamps and, in some cases, 2% more than provincial Gross Income.
A calculation by Sebastián Domínguez, from SDC Asesores Tributarios, places the final prices after taxes at $ 334.30, $ 68.70 and $ 603.09 for the three plans based on the taxes in force in the Autonomous City of Buenos Aires.
Melissa Galbraith is the World News reporter for Globe Live Media. She covers all the major events happening around the World. From Europe to Americas, from Asia to Antarctica, Melissa covers it all. Never miss another Major World Event by bookmarking her author page right here.