What are the downsides of not showing the ATT prompt?

The downside of not exposing the ATT prompt to users in your app is that Apple deems that you must show the ATT prompt and therefore rejects your app updates.

Apple seems to be taking the stance that any app that collects data -- or integrates an SDK that collects data -- that could be used for fingerprinting or to otherwise construct a persistent identity must expose the ATT prompt to explicitly collect an opt-in or opt-out choice from the user for tracking. Note that any app that is run as a business necessarily collects such data. It is my belief that Apple expects almost every app to expose the ATT prompt.