If popcorn is bundled with a movie ticket, it will be treated as a comprehensive supply. This means that the tax rate will depend on the main item i.e. the movie ticket. The GST Council in its 55th meeting requested Uttar Pradesh to clarify the GST rate for salt and spice flavored popcorn.
No increase in GST on popcorn.
Good news for popcorn fans — there is no change in the GST rate for your favorite snack. Popped popcorn in cinemas is taxed at 5% as it is considered part of restaurant services. When mixed with salt and spices, it is classified as salted and still attracts 5% GST.
However, if the popcorn is pre-packaged and labelled, the GST increases to 12%. Caramelized popcorn has a higher tax rate of 18 percent as it falls under the category of sugar confectionery.
The GST Council issued a clarification on the classification of popcorn.
According to government sources, the GST Council has recommended a detailed clarification to resolve disputes over classification of ready-to-eat popcorn with salt and spices. Under GST, all goods, including food items, are classified based on the Harmonized System (HS) classification.
It is a globally recognized system developed by the World Customs Organization (WCO). This system is adopted by more than 200 countries and covers 98% of international trade. It determines the applicable GST rates for each commodity based on its classification under specific chapters of the HS system.