The Indian government has introduced a differentiated tax on popcorn, with varying rates based on the ingredients. The decision has sparked much controversy and criticism due to its complexity
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Well yes, it’s not a hoax or even an end-of-year joke: the Indian government really decided to tax popcorn. From now on, depending on the type of popcorn you intend to purchase, the GST rate (a type of tax that is levied on goods and services in India) will vary.
If this seems like a bizarre decision to you, know that you are not alone. The new legislation has in fact sparked controversy, discussions and a shower of memes on social media. Yet, behind this tax, there is a logic that the government justifies as necessary to distinguish various types of snacks based on their ingredients.
Let’s try to understand something.
As of the latest amendments, the Goods and Services Tax (GST) Council, chaired by Finance Minister Nirmala Sitharaman, has established that unbranded popcorn, mixed with salt and spices, will be taxed at 5%. Packaged and branded popcorn will incur a 12% tax, while caramel ones, considered sweets, are subject to an 18% tax.
According to Sitharaman, the differentiation of the rates is justified by the fact that products with added sugar, such as caramel popcorn, are treated differently for tax purposes than savory ones because, being classified as confectionery, they are considered luxury goods or less essential than other foods.
Thus, the difference in tax rates is not, as one might expect, a direct measure to discourage sugar consumption or promote a healthier diet, but rather a fiscal distinction between sweet and savory products.
In other words, the decision seems more about tax classification than public health.
The outcry on social media and the criticism
The introduction of these new rates has triggered a storm of reactions on social media. The memes are ironic above all about the complexity of the system which could, among other things, not lead to the desired results in terms of revenue for the State.
One of the government’s former economic advisors, KV Subramanian, said on X (formerly Twitter): “Complexity is the pleasure of bureaucrats and the nightmare of citizens“, while his predecessor Arvind Subramanian criticized the government for going in the wrong direction by increasing complexity rather than simplifying the tax system. Finally, there are those who speak of real “absurdity” in treating popcorn with three different tax rates.
