GST Council on Saturday agreed to issue a clarification on taxation of popcorn, saying that pre-packed and labelled ready-to-eat snacks will attract a 12 per cent tax while an 18 per cent GST will be levied if it is caramelised.
There is no change in the tax rate of popcorn and the GST Council has only agreed that the Central Board of Indirect Taxes and Customs (CBIC) will issue a circular clarifying the present taxation regime of popcorn.
The GST Council has only agreed to the fact that ready-to-eat popcorn, mixed with salt and spices and possessing the essential character of namkeens, would continue to attract a 5 per cent GST if not pre-packaged and labelled.
If it is sold as pre-packaged and branded, a 12 percent GST would be applied.
However, if popcorn is mixed with sugar (caramel popcorn), its character changes to that of a sugar confectionary, and thus would fall under HS 1704 90 90 and an 18 percent GST would apply, according to the clarification.
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