If I buy an app in the App Store, will it work on future major releases or will I need to repurchase it?

Solution 1:

Yes it is definitively possible. As of now, Apple does not enable the developers to publish paid updates for their software. Due to that, developers sometimes release different versions to buy from the App Store.

E.g. have a look at http://itunes.apple.com/de/app/photoforge/id314173066 and http://itunes.apple.com/de/app/photoforge2/id435789422

Solution 2:

There have been a few apps that had been pushed out as totally separate apps when a new major version came out: Tweetie 2 for iOS (then iPhone OS) comes to mind, for example. This lead to a huge controversy, but given the price range of most apps (below $5) it's understandable that developers sometimes push out a new app instead of a free update. If you use an app a lot for a year or two, asking for another two bucks or so shouldn't be an issue, right?