New Delhi: In response to widespread public and social media backlash over reports of an 18% Goods and Services Tax (GST) on caramelized popcorn, government sources clarified on Tuesday that popcorn sold in theatres will continue to attract a 5% GST rate.
“Popcorn served loose in theatres is classified under ‘restaurant service’ and, as such, will remain taxed at 5%,” said an official familiar with the matter. This clarification comes after concerns were raised following discussions at the 55th GST Council meeting, which reviewed taxation on various forms of popcorn.
No Rate Hike for Theatre Popcorn
Government sources emphasized that there has been no recent hike in GST on popcorn served in cinemas. “A request from the State of Uttar Pradesh to clarify the GST rate on salted and spiced popcorn was discussed in the council. The council recommended clarifying the rate differences between types of popcorn,” the official added.
The controversy arose when caramelized popcorn was categorized as “sugar confectionery,” potentially subjecting it to an 18% GST. Pre-packaged and branded popcorn varieties would attract a 12% rate, while non-branded salted popcorn sold loose would remain taxed at 5%.
Simpler Taxation for Used Electric Vehicles
In a related decision, the GST Council unified the tax rate on old and used vehicles, including electric vehicles (EVs), at 18%. Previously, these items were taxed at different rates. Officials explained that this change simplifies the taxation system rather than introducing new taxes.
Popcorn’s Place in Indian Cinema Culture
Popcorn, an integral part of the movie-going experience in India, gained popularity in the 1990s with the rise of multiplexes. Over the years, its affordability, convenience, and evolving flavors—ranging from salted to spiced and caramelized—cemented its status as a beloved theatre snack.
However, public sentiment shifted when news of differential GST rates emerged. Moviegoers voiced frustrations over high prices at theatres and additional taxes on essentials like popcorn.
Social Media Backlash and Memes
Social media platforms erupted with criticism and satire. One viral meme quipped, “India finds three separate tax categories for popcorn while other countries tackle breakthroughs in AI and healthcare.” Public figures, including entrepreneur Anupam Mittal, joined the discourse with humorous remarks, highlighting the absurdity of taxing caramel popcorn differently.
Decision Reversed After Outcry
The uproar prompted swift action. Acknowledging the unique nature of theatre popcorn, the government confirmed that loose popcorn sold in cinemas would remain taxed at the lower 5% rate, aligning it with other snacks served in restaurant-like settings.
Finance Minister Nirmala Sitharaman assured the public that the decision was in line with the council’s intent to address concerns while maintaining fairness in taxation.
For now, moviegoers can continue to enjoy their caramel popcorn without worrying about paying exorbitant taxes—at least in the comfort of their favorite theatres.