GST on Gold in India
GST on gold jewellery, coins and bars in India is 3% of the full invoice value, including the making charge. Only job work, where you supply your own gold to a goldsmith, is taxed at 5% on the labour charge. The rate is the same in every state.
GST rates that apply to gold
| Transaction | GST | Charged on |
|---|---|---|
| Gold jewellery bought from a jeweller | 3% | Gold value + making charge + other charges on the invoice |
| Gold coins and bars | 3% | Invoice value |
| Job work (your gold, goldsmith's labour) | 5% | Labour charge only |
| Digital gold | 3% | Purchase value |
| Individual selling old jewellery | None | The individual seller does not charge GST |
Within a state the 3% is split as 1.5% CGST and 1.5% SGST; on an inter-state sale it appears as 3% IGST. The total is identical. GST replaced the earlier VAT and excise system on 1 July 2017.
Worked example: buying jewellery
Suppose the 22K rate is ₹12,250 per gram (illustrative) and you buy a 25 g necklace with a 10% making charge:
| Item | Calculation | Amount |
|---|---|---|
| Gold value | 25 g × ₹12,250 | ₹3,06,250 |
| Making charge | 10% × ₹3,06,250 | ₹30,625 |
| Taxable value | ₹3,06,250 + ₹30,625 | ₹3,36,875 |
| GST | 3% × ₹3,36,875 | ₹10,106.25 |
| Total | ₹3,46,981.25 |
Making charge is part of the taxable value, so a higher making charge also means more GST. A jeweller who quotes GST at 3% of the gold value only, or charges a separate 5% on making for a ready-made piece, is not following the usual treatment; ask for a corrected invoice. Try your own figures in the jewellery price calculator.
Exchanging old gold for new jewellery
In the generally applied practice, the jeweller bills the new jewellery in full, charges 3% GST on that full value, and then deducts the value of your old gold from the amount you pay. GST is not reduced by the exchange. Continuing the example, suppose you hand over 15 g of old 22K jewellery and the jeweller values it at ₹11,800 per gram after its deduction:
| Item | Amount |
|---|---|
| New necklace including GST | ₹3,46,981.25 |
| Less old gold: 15 g × ₹11,800 | − ₹1,77,000 |
| Balance payable | ₹1,69,981.25 |
GST stays at ₹10,106.25 because it is calculated on the new item. Some jewellers present the bill differently, and tax treatment of exchanges has been discussed by tax authorities over the years, so read the invoice and ask how GST was computed. The value given for old gold depends on its tested purity and the jeweller's deduction; see how to sell gold.
Job work: when 5% applies
If you give 20 g of your own gold to a goldsmith to remake into a new design and the labour charge is ₹8,000, GST is 5% × ₹8,000 = ₹400. No GST is charged on your own gold because it is not being sold to you. If the goldsmith adds 2 g of their own gold, that added gold is a sale and is taxed at 3% on its value.
Gold investments and GST
- Coins and bars: 3%, the same as jewellery, but making charges are lower, so the total tax is lower.
- Digital gold: 3% on purchase, which is one reason it costs more than the screen price. See digital gold in India.
- Gold ETFs and gold mutual funds: no GST on the units themselves; GST applies only to brokerage and fees. See gold ETF vs physical gold.
- Sovereign Gold Bonds: no GST. See Sovereign Gold Bonds.
GST and the rates you see quoted
Board rates and the live rates on this site exclude GST. The India gold rate includes the 6% import duty, which is a separate tax collected at the border (see gold import duty in India). To estimate the pre-making cost of 10 g of 22K at an illustrative ₹12,250 per gram: ₹1,22,500 × 1.03 = ₹1,26,175.
Working backwards from a GST-inclusive price
If a jeweller or app quotes a price including GST, divide by 1.03 to find the taxable value. A coin offered at ₹1,03,000 including GST has a taxable value of ₹1,03,000 ÷ 1.03 = ₹1,00,000, and the GST is ₹3,000. Dividing the inclusive price by the weight then shows the effective per-gram cost, which you can compare with the live rate plus the dealer's premium. Note that 3% of the inclusive price (₹3,090 here) overstates the tax; the 3% applies to the pre-tax value.
Invoice checklist
- Jeweller's GSTIN and your name on the invoice.
- Gross weight, net gold weight, purity and HUID for each piece.
- Rate per gram, making charge, stone value (if any) shown separately.
- GST at 3% on the taxable total, split into CGST and SGST or shown as IGST.
Keep the invoice: it proves purchase cost if you sell later and helps with buy-back at the same jeweller.