GST 2.0: Salted Popcorn To Attract 5 Per Cent, Caramel-Flavoured 18 Per Cent

New Delhi, Sep 4: The GST Council has finally settled the long-running debate over how popcorn should be taxed in India as under the new GST 2.0 regime, popcorn mixed with salt and spices will attract 5 per cent GST, whether it is sold loose or in pre-packaged and labelled form.

Salted Popcorn Retains “Essential Character” of a Snack

The Council has ruled that such popcorn retains the “essential character” of a snack.

Caramel Popcorn Categorised as Sugar Confectionery

Caramel popcorn, however, has been categorised differently. Since it falls under the definition of sugar confectionery, it will continue to attract 18 per cent GST.

Clarification Part of Latest Revised GST List

The clarification was part of the latest list of items under revised GST rates released by the government.

Previous Popcorn Taxation Led to Confusion

Until now, the taxation of popcorn had been a confusing affair. Salted popcorn was charged 5 per cent GST if sold loose, but the rate went up to 12 per cent if it was branded and packaged.

Caramel popcorn was consistently taxed at 18 per cent. This dual treatment created uncertainty for both small vendors and large multiplexes.

Historical Context of Popcorn Controversy

The “popcorn controversy” has been around since GST was first rolled out in July 2017. Initially, loose popcorn was exempt from tax while packaged popcorn attracted 12 per cent GST.

Multiplex Operators Sought Uniform Taxation

Multiplex operators argued that the popcorn they sold at counters should be taxed like restaurant service at 5 per cent, instead of as a packaged commodity.

By 2019, the GST Council clarified that popcorn sold in cinemas would be taxed at 5 per cent, while branded packaged popcorn would remain at 12 per cent. This split structure, however, led to more confusion and even legal challenges.

Recent Push for Rationalised GST Slabs

In 2022, the Multiplex Association of India sought uniform treatment, insisting that popcorn sold in theatres was “freshly prepared” and should not be compared with FMCG goods.

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The debate flared again in 2023 when the Council began discussing rationalisation of tax slabs, especially as cinema snack prices became a hot topic among consumers.

(Disclaimer: Except for the headline, this article has not been edited by FPJ's editorial team and is auto-generated from an agency feed.)