India’s GST Council has finally resolved the long-standing debate about how to tax salted popcorn and caramel popcorn. Whether you’re excited or not depends on your personal taste. Under GST 2.0, popcorn that has been mixed with salt and spices will attract a 5% GST rate, whether it’s sold loose or in pre-packaged and labeled form, because it still has the “essential character” of a snack. Caramel popcorn, however, will be taxed at 18% because it’s classified as a sugar-based confectionery, which is considered non-essential. This new list of items with updated GST rates was released by the government.
A popcorn controversy since GST 1.0. When India’s Goods and Services Tax was first introduced on 1 July, popcorn was taxed differently based on how it was sold. Branded and packaged popcorn had to pay 12% GST, while loose popcorn was tax-free. This dual system created confusion for both small vendors and multiplexes. In 2018, multiplexes, which often sold popcorn at high prices, argued that popcorn sold in cinema halls should be treated as a restaurant service (5% GST) rather than as a packaged product (12% GST).
A year later, the GST Council decided that popcorn sold in a cinema or restaurant-style counter should attract 5% GST, while branded popcorn would be taxed at 12%. This decision was challenged in courts for a few years. In 2022, the Multiplex Association of India lobbied for a fairer system, claiming that popcorn is “freshly prepared” and not similar to mass-produced FMCG items.
GST Rationalisation.                                    The debate about how to tax popcorn came back into focus when the GST Council started discussions on rationalizing GST rates in 2023. Popcorn, along with other snacks like namkeen, chips, and roasted corn, was flagged because it was taxed under multiple slabs. In 2024, as popcorn prices at the multiplex started to rise, the discussion returned about whether cinema popcorn is a luxury item or a basic snack. The government’s answer was to tax it based on its flavor.
