App Tracking Transparency privacy checkboxes and app store release rejection

I keep getting my iOS app submission rejected by apple with the following message:

Guideline 5.1.2 - Legal - Privacy - Data Use and Sharing

The app privacy information you provided in App Store Connect still indicates you collect data in order to track the user, including User ID and Product Interaction. However, you do not use App Tracking Transparency to request the user's permission before tracking their activity.

Starting with iOS 14.5, apps on the App Store need to receive the user’s permission through the AppTrackingTransparency framework before collecting data used to track them. This requirement protects the privacy of App Store users.

Next Steps

Here are two ways to resolve this issue:

• If you do not currently track, or decide to stop tracking, update your app privacy information in App Store Connect. You must have the Account Holder or Admin role to update app privacy information.

• If you track users, you must implement App Tracking Transparency and request permission before collecting data used to track. When you resubmit, indicate in the Review Notes where the permission request is located.

Resources

• Tracking is linking data collected from your app with third-party data for advertising purposes, or sharing the collected data with a data broker. Learn more about tracking.
• See Frequently Asked Questions about the new requirements for apps that track users.
• Learn more about designing appropriate permission requests.

I already updated my app not to use any IDFA calls (including all the facebook and other SDKs) https://developer.apple.com/documentation/adsupport/asidentifiermanager/1614151-advertisingidentifier

When I try to set the checkboxes in App Privacy section of the app they can't be completely uncheck (i.e. at least one of the options has to be selected) so I can't state that my app is no using device id even though the codebase doesn't make advertisingidentifier at all.

Does App Tracking Transparency really mean that we can't track anything, even user clicks on buttons and screen views???? If so that's insane!

The main issue is that I want to have a better user experience for my users by not showing them an unnecessary ATT prompt.

You need to do the following 2 things:

1. Update the Data Types section to remove the Device Id. You can find it on the top of the privacy section, then hit Edit, navigate through till the last Nexts and uncheck the Device Id

2. Update the User ID and Product Interaction sections to uncheck - No, we do not track the user. You can find it at the end of the privacy section, then hit Edit, navigate through till the lastNexts and uncheck the above-mentioned box.

Submit the app again for review.