Vault Dweller, if I may ask... what % of sales do you guys actually receive after Steam fees, engine fees, taxes, etc have all been taken out?
I understand if you don't want to reveal too many specifics, but my guess is most indie devs probably end up with around 50% of revenue actually reaching their coffers. Is that in the ballpark?
There's no simple answer to this question as there are too many variable there. Take VAT, for example:
In the beginning nobody charged any tax on digital goods but now that everyone realized what a cash cow it is, not a month goes by without more countries demanding their cut. VAT makes sense when the state invests in infrastructure and services that support business growth, and when the business can get a tax credit for VAT paid, which balances it out. Without neither, it's nothing but a cash grab - a tax on the privilege to sell digital goods to Russian (20%), Swedish (25%), Italian (22%), or German (19%) gamers; 53 countries in total. In comparison, Canada doesn't charge tax on digital goods yet and the United States is 50/50 on the issue (only 28 states tax digital goods (1-7%), the rest don't), I don’t think they’ll be able to resist the temptation to put a hand in someone’s pocket for long. The tax is included in the price and thus comes out of the developer’s end, so when you buy games, 20% of what you pay goes back to your government (do your patriotic duty and buy more games to support your country!). So roughly half of what you sell is VAT-free, half isn't, but the VAT rate varies from 10 to 28%.
Engine fees also go from 0 to 5% which can be applied differently, in some cases to gross sales, even before Steam takes their cut, in others after. Corporate taxes also vary based on your setup (for example, employees vs contractors) and where the company is incorporated and whether or not it has a tax treaty with the US. If it doesn't, you have to file a US return, pay an accountant a few grand a year as the US tax code is a mess with many hidden pitfalls, and pay tax on the money paid by the US citizens. Fortunately, Canada has such a treaty which states that royalties and/or digital goods shall not be taxed, so we dodged a bullet there. The corporate taxes are low here - 11.5% (in the US it's 21% now, Biden wants to raise it to 28%), etc.
