What’s Next? Union Budget’s Role in Addressing GST Challenges

New Delhi, 23 Dec. The ongoing debate over varying Goods and Services Tax (GST) slabs for popcorn has sparked widespread attention on social media, with the Congress party criticizing the government’s tax policies. The controversy has shed light on the complexities of India’s GST framework, with Congress urging a complete revamp to introduce a simpler, more efficient system.

The Popcorn Tax Breakdown: GST Rates Explained

During the 55th GST Council meeting held in Jaisalmer on December 21, Finance Minister Nirmala Sitharaman clarified the tax rates for different types of popcorn:

• Plain salted popcorn (classified under ‘namkeens’):
  • 5% GST if sold loose (non-packaged and non-labelled).
  • 12% GST if pre-packaged and labelled.
• Caramel popcorn (classified as sugar confectionery):
  • 18% GST due to added sugar content.

Sitharaman explained, “Items with added sugar, such as caramel popcorn, fall into the sugar confectionery category and attract higher GST. While salted popcorn is treated as a namkeen, the addition of sugar changes its classification.”

Congress Slams the Complexity of GST

Congress general secretary Jairam Ramesh took to social media to express his concerns about the growing complexity of the GST system, labeling the debate over popcorn tax slabs as “absurd.”

He stated, “The GST system, which was meant to be a Good and Simple Tax, has become overly complex. Issues like GST evasion, input tax credit fraud, and misclassification of goods are rampant.”

Ramesh further highlighted alarming statistics from the Directorate General of GST Intelligence (DGGI), which revealed GST evasion of ₹2.01 lakh crore in FY24.

The Call for GST 2.0

With the Union Budget just weeks away, Ramesh questioned whether the government would “summon the courage” to overhaul the GST system and launch GST 2.0. He also pointed out key issues plaguing the current system:

• GST evasion and fraud: Thousands of bogus companies set up to exploit loopholes.
• Compliance hurdles: Registration flaws, weak supply chain tracking, and cumbersome filing requirements.
• Misclassification of goods: Frequent missteps leading to unfair taxation.

Social Media’s Meme Storm

The debate has also unleashed a flood of memes and jokes online, with netizens humorously dissecting the complexity of popcorn GST. The trending topic reflects public frustration with the convoluted system and its seemingly trivial classifications.

Conclusion: A Tax System in Need of Reform

The caramel popcorn controversy is more than just a social media talking point—it’s a symptom of the broader challenges facing India’s tax system. As the country prepares for the upcoming Union Budget, the spotlight is on the government to address these systemic issues and deliver a truly simplified GST framework.

By Qamrul Salehin, Editor for News 360

Source: News360