New Delhi, Sep 4 : In a long-awaited move that puts an end to the years-long debate, the GST Council has finally clarified the tax treatment of popcorn under the newly introduced GST 2.0 regime. As per the new ruling, salted or spiced popcorn whether sold loose or in a pre-packaged and labelled form will now uniformly attract 5% GST. The Council concluded that such popcorn retains its “essential character” as a snack, thereby deserving a standard rate across all formats. This decision simplifies the earlier dual structure and brings relief to vendors, cinema owners, and consumers alike. However, not all popcorn is created equal in the eyes of the taxman. The Council has made a clear distinction for caramel popcorn, which, due to its sugar content, falls under the category of sugar confectionery and will continue to attract 18% GST. This means that while your regular masala or buttered popcorn at the movies gets cheaper, your sweet caramel fix still remains a premium indulgence. The distinction aims to bring logical consistency to the tax structure based on ingredients and preparation. This clarification addresses years of confusion and inconsistency. Previously, loose salted popcorn attracted 5% GST, but if it was branded and packaged, it was taxed at 12%. Multiplexes had long argued that popcorn sold at their counters was freshly made and should be taxed similarly to restaurant services at 5%. The lack of a unified rule led to disputes, inspections, and legal challenges. The Multiplex Association of India, in 2022, even demanded parity in treatment, saying cinema popcorn is not comparable to FMCG goods. The “popcorn controversy” dates back to the early days of GST rollout in 2017 and has been a symbolic case for tax rationalisation. The latest GST 2.0 reforms aim not just to simplify tax brackets but also to address consumer grievances and business complications. With cinema snack prices often under public scrutiny, this move is likely to bring both economic clarity and public satisfaction. Vendors can now price their products more consistently, and consumers will benefit from reduced ambiguity and hopefully, cheaper popcorn.
