Finance Minister Nirmala Sithraman has come under fire after the GST Council recommended 18 per cent GST on caramel popcorn. Currently, salted popcorn is taxed at 5 per cent GST.
Security analyst Sushant Sareen said that India will always be a third-world country if we have a "brainless bureaucracy" and "clueless politicians" who penalise anything that remotely resembles upgrading products.
"Apparently for these socialist geniuses unpackaged popcorn is a necessity, packaged ones are comfort food and caramelised are luxury," he said on the new taxation. "Next they will say flavoured popcorn with cheese are sin goods and taxed at whatever ridiculous rate they decide."
Sareen said that the Good and Simple Tax is neither good nor simple, "it is tax till you kill the golden goose model". "Even basic common sense on economics escapes these people because socialistic pretensions outweigh everything else," he added.
The finance minister later clarified that ready-to-eat popcorn which is mixed with salt and spices attracts 5 per cent GST. She said salted popcorn is sold in the name of namkeen but caramelised popcorn comes with added sugar, which is taxed differently. "When you talk outside, it looks silly...but states say that we treat products with added sugar differently be it drinks or juice. This is why as long as popcorn is namkeen it is taxed at 5%, but when it is added sugar, it has a different tax."
Sitharaman's clarification did not impress Sareen, who said this was not clearing the air, it was actually an "illustration of the sheer craziness that has taken over GST". "World over there is one or 2 rates and no such complexities and hair splitting. But here we have taken things to ridiculous levels. Has anyone thought about ease of business while making such policies?"
Alok Jain , founder of WeekendInvesting, too blasted the government for this different taxation, calling it a "mindless" and "unnecessary regulations". He said this displays well the third-class backward attitude of the people articulating this. "If you want to have popcorn with caramel you are a sinner. What mindless and unnecessary regulations we are makingQ!!! Displays well the third-class backward attitude of the people articulating this. This is NOT simplifying business you morons!!!"
In its statement, the finance ministry said that there was no new imposition of any tax in this regard and was merely a clarification as certain field units were demanding different tax rates on the same. "Therefore, it is a clarification being recommended by the GST Council to settle the disputes arising out of interpretation."