GST rate on Popcorn

From Newsbuddy Desk

Has the GST rate on popcorn been increased?
Ans: There has been no increase in the GST rate on popcorns in the recently held GST Council meeting. A request was received from State of Uttar Pradesh to clarify the classification and GST rate applicable on popcorn mixed with salt and spices. This issue was taken to the 55th GST Council and the Council recommended to clarify the same.

What is the basis for varying rates on different types of popcorn?
A: All goods including food items are classified under GST as per the Harmonised System (HS) classification which is a multipurpose international goods nomenclature developed by the World Customs Organisation (WCO). This system is used by over 200 countries covering over 98% of the international trade. The varying GST rates are only consequential to the classification of the commodity under the different chapters of the HS system.
As per the HS classification, sugar confectionary falls under HS 1704 in Chapter 17. All sugar confectionary, other than few specified items, attract 18% GST. In India, namkeens are classified under HS 2106 90 99. Namkeens attract 5% GST when sold in other than pre-packaged and labelled form and 12% GST when sold in pre-packaged and labelled form.

What was the objective in issuing the clarification?
Ans: The Council recommended issuance of clarification to facilitate resolution of classification disputes in the field on ready to eat popcorn that is mixed with salt and spices.

Will sale of popcorn get more expensive in theatres?
Ans: Generally, Popcorn is served to customers in theatres in loose form and hence will continue to attract rate of 5% as applicable to ‘restaurant service’ as long as supplied independent of the cinema exhibition service.