Late in December 2024, the munchy popcorn found itself in the spotlight amid different tax rates proposed by the GST Council based on its sugar or salt component. As per the clarification, the GST rate on popcorn mixed with salt and spices will be 5%, while it will be 12% on prepackaged and labelled popcorn and 18% on caramelised popcorn.

Expectedly, this move faced a lot of backlash and flak countering the very positioning of GST being touted as a straightforward tax system. Former Chief Economic Advisor Krishnamurthy Subramanian criticised the proposal in a tweet saying, “Complexity is a bureaucrat’s delight and citizen’s nightmare.”

Many are of the opinion that the idea of GST being a “good and simple tax” is now lost in a labyrinth of rates, forms and compliances. Businesses have since the inception of GST been clamouring for simplification and manufacturing units, in particular, say they have been hit by complexities of the indirect tax. While manufacturing in the country is in trouble due to tepid demand and high cost of business, GST has thrown a spanner into the works.

Incidentally, the November data for GST also reveals a not-so-heartening trend of certain key states exhibiting a lacklustre growth. A slower single digit growth in some large states Haryana (2%), Punjab (3%), UP & MP (5%), Tamil Nadu (8%), Telangana (3%) as well the negative growth in Rajasthan (-1%), AP (-10%) and Chhattisgarh (-1%) warrants deliberation as these states have significant manufacturing activity.

 

Source : The Economic Times