Government sources said Popcorn, in loose form, sold in movie theatres will continue to attract GST at a 5 per cent rate, same as in restaurants. However, if the popcorn is clubbed and sold together with a movie ticket, the supply would be treated as a composite supply and taxed as per the applicable rate of the principal supply, which is the ticket. The 55th meeting of the GST Council clarified the GST applicability in popcorn after it received a request from Uttar Pradesh to clarify the classification and GST rate applicable to popcorn mixed with salt and spices. There has been no increase in the GST rate on popcorn.
Meanwhile popcorn is served to customers in theatres in loose form and hence will continue to attract a rate of 5 per cent as applicable to ‘restaurant service’ as long as supplied independently of the cinema exhibition service. Under GST, popcorn mixed with salt and spices is classified as namkeen and attracts a 5 per cent tax. When it is pre-packed and labelled, the rate is 12 per cent.
Moreover all sugar confectionary, other than a few specified items, attract 18 per cent GST, and hence, caramelised popcorn attracts an 18 per cent rate. 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).
click and follow Indiaherald WhatsApp channel