GST on Popcorn: A Comprehensive Breakdown of Tax Rates from Cinemas to Local Sellers
The question of how GST applies to popcorn has puzzled cinema operators, shop owners, and even local popcorn sellers. If you’re also confused about the GST Council’s decisions on popcorn taxation, this article clears up all your doubts. The Central Government has issued a detailed FAQ about GST rates on popcorn, providing clarity on this matter.
No Change in GST Rates on Popcorn
The GST rates on popcorn remain unchanged. However, the government has issued clarifications on the classification of popcorn under different categories and the applicable GST. The 55th GST Council meeting did not increase the rates but provided explicit guidelines on how GST will be applied based on the type of popcorn.
FAQs on Popcorn GST Rates
Will Movie Theater Popcorn Become Expensive?
No, the popcorn served loose in movie theaters is subject to a 5% GST rate under restaurant services. Thus, loose popcorn in cinemas will continue to attract a 5% GST.
Popcorn Types and Their GST Rates
- 5% GST
- Popcorn sold loose in movie theaters.
- Salted and spiced popcorn classified as savory or “namkeen.”
- Popcorn bundled with movie tickets will attract GST according to the ticket’s tax rate.
- 12% GST
- Pre-packed and labeled popcorn.
- According to GST rules, packaged and labeled popcorn falls under the 12% GST slab.
- 18% GST
- Caramelized popcorn, which is categorized as sugar confectionery, attracts an 18% GST rate.
Why Different GST Rates on Popcorn?
All goods, including food products, are classified under the Harmonized System (HS) Classification developed by the World Customs Organization (WCO). This system, used by over 200 countries, covers more than 98% of global trade. The varying GST rates result from the classification of popcorn under different chapters of the HS system.
Expert Tips to Avoid Tax Confusion
- Always check the packaging. Loose popcorn generally has a lower GST rate.
- For business owners, understanding the HS classification can help determine the exact GST slab.
Additional Resources on GST
To further understand GST classifications and rates, visit:
Conclusion
The GST on popcorn varies based on its type—whether it’s loose, salted, pre-packed, or caramelized. The recent clarifications from the GST Council ensure transparency and eliminate confusion. By understanding these rates, both sellers and consumers can make informed decisions.
For more insights on GST and taxation, explore our article: How GST Impacts Everyday Essentials.