Want to buy popcorn with your movie ticket? So you can keep your GST low

If you only buy movie tickets for admission and then buy food, the food won’t be charged on your card and you’ll be charged 5 percent, officials said. Next time you go to the movies, avoid combo packages that include food and drinks in addition to movie tickets.

Despite the Goods and Services Tax (GST) Council’s decision to reduce the tax on food and beverages served in movie theaters from 18 percent to 5 percent, the benefits are available separately for the two. The Times of Times reported that only if purchased in . India (TOI). “When purchased together, they are treated as a combined supply, the main service being to watch a movie or to provide access to the auditorium of a cinema, which is subject to an 18% tax.

It also happens to be a meal. It’s included and billing is consolidated, but “but if you buy an admission movie ticket and then buy a meal, you won’t be charged for the meal on your card, you’ll be charged 5 percent.” will be,” said Vivek Jori. Chairman of the Central Committee for Indirect Taxes and Tariffs opposite the TOI. The executive also said the policy applies even if tickets are purchased online. “As long as they are billed separately, they will be billed at different rates.”

While the GST Council has decreased the rate on food and beverages to bring it in line with the charge in restaurants, it is now up to cinema halls to pass on the benefit to customers, which authorities will monitor, he added.

On June 11, the GST Council, chaired by the Federal Secretary of the Treasury and comprising representatives from the states and the UT, voted to reduce the service tax on food and beverages consumed in cinemas from 18 percent to 5 percent. bottom.

Multiplex operators welcome the GST Council’s decision, claiming it will help revitalize theater business and avoid lawsuits after the coronavirus crisis.

Food & Beverage (F&B) is an important revenue source for the Motion Pictures segment, especially multiplexes, with up to 35 percent of revenue generated from this segment.

The GST Council said it had decided that the supply of food and beverages in cinema auditoriums would be taxable as restaurant services only if:

1. They are supplied by way of or as part of a service and,
2. They are supplied independently of the cinema exhibition service. Where the sale of cinema tickets and supply of food and beverages are clubbed together, and such bundled supply satisfies the test of composite supply, the entire supply will attract GST at the rate applicable to the service of exhibition of cinema, the principal supply.

It means that if you book your tickets online and club food with it, then the tax rate of 5 per cent is not applicable.