Your Popcorn, Samosas At Multiplexes Can Only Attract 5% GST: Govt Clarifies

The audience, who have been complaining about the expensive popcorn or snacks at multiplexes, can breathe a sigh of relief as the government on Tuesday clarified that cinema halls cannot impose 18 per cent GST on food and beverages.

"It was clarified by the council today that food and beverages in cinema halls will attract 5 per cent and not 18 per cent GST," Sanjay Malhotra, Revenue Secretary, said on Tuesday.

Multiplex Association of India (MAI), an industry lobby group representing cinema owners, has been making efforts to reduce the tax as some states impose 18 per cent GST on food and beverages at cinema halls.

"Cinema theatres across India levy 5% rate on F&B since GST was introduced. However, in the past 12-15 months, some cinemas received notice from local bodies that F&Bs in cinema's can't be treated as restaurant services. Instead of fighting at the local level, we decided to make a representation to the government to avoid unnecessary litigation," Mint quoted Nitin Sood, chief financial officer at PVR Inox Ltd, as saying.

This is expected to give relief to the cinema audience who has often complaining about expensive food items sold at multiplexes. "The cost of the movie-going experience will come down and any rebates or subsidies will only make the sector healthier, since it really has been a tough scenario over the past few months," Akshaye Rathi, an exhibitor and film distributor, said.

It has to be noted that food and beverages are important sources of income for multiplexes.