Union Minister's Clarification On GST For Popcorn

Union Finance Minister Nirmala Sitharaman has addressed the ongoing debate regarding the Goods and Services Tax (GST) on popcorn, emphasising that the issue stems from differing classifications of the product rather than the imposition of a new tax.

Speaking on the matter, the Finance Minister noted, “Salted, caramelised, plain popcorn is being sold as namkeen in certain states. Caramelised popcorn, however, contains added sugar, which alters its classification and applicable tax rate.”

The Ministry of Finance clarified the situation further, explaining that ready-to-eat popcorn mixed with salt and spices falls under HS code 2106 90 99. This classification attracts a 5% GST if sold loose and a 12% GST if pre-packaged and labelled. In contrast, caramelised popcorn, due to its sugar content, is classified as sugar confectionery under HS code 1704 90 90, attracting an 18% GST.

The Ministry stressed that this clarification aims to resolve disputes stemming from varying interpretations by tax authorities, not to impose a new tax. It added, “The decision to regularise the issues for the past on an ‘as is where is’ basis has been recommended by the GST Council.”

The clarification was issued following the 55th meeting of the GST Council held in Jaisalmer, Rajasthan, chaired by Union Minister Nirmala Sitharaman. The meeting was attended by Union Minister of State for Finance Pankaj Chaudhary, Chief Ministers of several states, and other key officials.