Congress slams govt over totally different tax slabs for popcorn, asks if PM will present braveness for GST overhaul

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| Picture Credit score: BISWARANJAN ROUT

Exhorting the Narendra Modi authorities to indicate the braveness to overtake the Items and Companies Tax (GST) regime citing the “absurdity” of three totally different tax slabs for popcorn beneath the current system, the Congress on Sunday (December 22, 2024) stated the present complexities within the system had thrown open a number of loopholes resulting in tax evasion. 

In an extended put up on X, Congress Basic Secretary (Communications) Jairam Ramesh stated, “The absurdity of three totally different tax slabs for popcorn beneath GST, which has unleashed a tsunami of memes on social media, solely brings to gentle a deeper problem: the rising complexity of a system that was alleged to be a Good and Easy Tax.”

These complexities, he stated, have been resulting in important GST invasion, enter tax credit score fraud was frequent, and the variety of bogus firms set as much as ‘recreation’ the GST system bumped into hundreds.

“Monitoring of provide chains is weak; the registration course of is flawed; benefits are being taken out of loopholes in turnover exemptions; compliance necessities are nonetheless cumbersome; and misclassification of products is frequent,” Mr. Ramesh stated.

He stated the latest knowledge on tax frauds uncovered by the Directorate Basic of GST Intelligence (DGGI) reveal GST evasion of ₹2.01 lakh crore in FY24.

“With the Union Price range now simply 40 days away, will the Prime Minister and the Finance Minister summon the braveness to launch an entire overhaul and institute a GST 2.0?” Mr. Ramesh requested.

The GST Council on Saturday agreed to problem a clarification on taxation of popcorn, saying pre-packed and labelled ready-to-eat snacks will entice a 12% tax whereas an 18% GST can be levied whether it is caramelised. There isn’t a change within the tax charge of popcorn and the GST Council has solely agreed that the Central Board of Oblique Taxes and Customs (CBIC) will problem a round clarifying the present taxation regime of popcorn.

‘Prepared-to-eat popcorn’, which is blended with salt and spices, and has the important character of namkeens, at present attracts a 5% GST if it isn’t pre-packaged and labelled.

Whether it is equipped as pre-packaged and labelled, a 12% GST is levied.

Nonetheless, when popcorn is blended with sugar (caramel popcorn), its important character adjustments to that of a sugar confectionary, and would due to this fact be classifiable beneath HS 1704 90 90 and entice an 18% GST, as per the clarification.