The Goods and Services Tax (GST) system in India has come under scrutiny following the GST Council's recent decision regarding popcorn tax rates, which has exposed significant flaws in its architecture and implementation. During the 55th GST Council meeting held in Jaisalmer on December 23, 2024, it was decided that popcorn mixed with salt and spices would be taxed at 5%, prepackaged popcorn at 12%, and caramelized popcorn at 18%. This decision has sparked criticism from various economists, including Krishnamurthy Subramanian and Mohandas Pai, who argue that the current tax structure is overly complex and inefficient [70a4b873].
Originally intended to simplify taxation across the country under the principle of 'One Nation, One Tax', the GST has instead become increasingly convoluted, featuring multiple tax slabs of 0%, 5%, 12%, 18%, and 28% plus cess. This complexity has raised concerns about the ease of doing business in India, as businesses struggle to navigate the intricate tax landscape [70a4b873].
Critics have called for a structural overhaul of the GST to restore its original intent and improve its functionality. The ongoing debates surrounding tax rates and classifications highlight the urgent need for reforms that would streamline the GST system, making it more user-friendly and efficient for businesses and consumers alike [70a4b873].