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Published on:

January 24, 2025

Viraaj Vashishth

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GST on Gold in India 2025: 22, 24 Carat Jewellery Ornaments, Coins, Biscuits, etc

For Indians, Gold does not mean only a metal but it is meaningful in a cultural perspective and is embedded in the economy of the country as well as in the investment space. Through the years, the introduction of the Goods and Services Tax (GST) has radically changed the processes of obtaining gold and its taxation in the country. If it is a decorative piece of jewellery, coins with investment value, or gold biscuits, it is important for consumers to understand the implications of GST. In this article, we explain the GST on gold in India in 2025, in relation to its rates, its implications and other factors, with respect to 22 and 24 carat gold, ornaments or jewelry, coins or bars.

What Are The Impact Of GST On Gold In India

Transactions involving gold were taxed with a number of indirect and estate taxes including an excise duty, customs duty, and a value added tax before the introduction of the GST. Due to the disarray in tax obligations, buyers ultimately ended up facing higher prices. However, GST has extracted these numerous layers of tax and layered it into a single system. Looking towards 2025, gold has a mandated GST charge of 3% of its value, with a further 5% GST charge being required for the making of Jewelry.

There has been marked improvement in the price setting for the gold industry, however, it has unfortunately raised the final prices for the end consumers. Still, gold is loved by people in India and while these taxes may have raised the rates of gold, there is no denying that wedding jewelry and investing remain irreplaceable.

Gold Classifications and Their GST Values

Gold is sold in a wide variety of forms along with various types of transactions, it is important to note that GST is not uniform, and changes depending on the nature of the purchase., For Example, instead of buying jewelry for wedding use, one could opt to purchase gold coins or bars. This is how GST is to be applied:

Gold Form	GST Rate	Details
Gold Jewellery	3% + 5%	3% on the gold value and 5% on the making charges.
Gold Coins (22 Carat)	3%	Includes coins used for investment or ceremonial purposes.
Gold Coins (24 Carat)	3%	Pure gold coins are ideal for long-term investments.
Gold Bars or Biscuits	3%	Typically used for trading or as a high-value investment.

22 Carat Gold GST Rate

In India, the consumption of 22 carat gold continues to be quite strong. The alloy’s combination of strength and purity makes it ideal for highly detailed jewellery carvings. The GST of 22 carat gold currently offered in Bharat consists of 3% GST on gold value and 5% VAT on making charges.

Example

Let’s assume the making charges of Rs 10,000 for the crafting of a 22 carat gold necklace worth Rs 1,00,000. GST applicable can be computed as follows:

1. GST on Gold Value: Rs 1,00,000 x 3% = Rs 3,000

2. GST on Making Charges: Rs 10,000 x 5% = Rs 500

3. Total GST: Rs 3,500

Even though this dual taxation is simple, it still demonstrates why there is a difference between what the cumulative price is and what the consumers see in terms of price.

24 Carat Gold GST Rate

24 carat gold is the purest form of gold but this type is primarily used in coins and bars, not for making jewelries. 24 carat gold has no alloys, or making charges, because of which it attracts a mere tax rate of 3% GST with regards to its purchase cost.

Example

If you’re bidding on a gold bar with a weight of 24 carat. And if the bidding price goes up to Rs. 2,00,000, you would have to pay a combined tax of Rs. 6,000.

1. GST for Gold Value: Rs. 2,00,000 x 3% = Rs. 6,000

2. Once again, the detailed Combined Tax comes to Rs.6,000.

To cut it short, it is much better to invest in 24-carat gold than jewelry as there are substantially fewer taxes and charges when dealing with it.

How Much GST on Gold Jewellery?

What a gold purchase lacks in excitement it makes up for in prestige, and Indians often go for gold jewelry not just for looking good but also for its heavy cultural connotation it comes bundled with. Despite that, jewelries come at a steep price, not just in terms of the base price but also in terms of taxes which includes the making charge and the GST on jewelry.

1. Gold Value Charge - 3% GST

2. Making Charges - 5% GST

Example Calculation:

Bracelets can be sold for a price as high as 1,50,000 rupees and can come with considerably high charges for making, going up to 15000 rupees

1. Making Charge GST: Rs.15000 x 5 = Rs.750

2. Gold Value GST: Rs.150000 x 03 = Rs.4500

Combined GST: Rs.5250

Due to the heavy taxes and steep prices attached to jewelry, it’s always better to first look at the rapid breakdown of the charges before deciding to finalize your purchase.

GST on Gold Ornaments

Ornaments are another form of jewelry that is heavily used and often comes in the form of intricate designs, which allows gold to be sold at 3% GST. Based on the ornament’s craftsmanship, manufacturing charges can be steeper, leading to a jump in GST pricing on the ornament.

Impact of GST on Gold Trade in India

The introduction of GST did make substantial changes in working of the gold business in India and is discussed below:

1. Simpler Taxation: As previously stated, there were multiple indirect taxes that existed which were a hindrance when trying to purchase gold and due to GST fraud and blurry lines in the industry disappeared.

2. More Expensive for Buyers: Due to the additional GST over making charges and further with the import charge gold items tend to be more expensive as the overall cost increases.

3. Improved Technology Integration: Strong measures ought to be taken in issuing invoices and maintaining records of invoice receipt would be beneficial the gold industry as it will be more systematic. .

4. Effect on Purchasing Culture: The demand did drop a little in the earlier years but has now largely been secured, therefore consumers sentiments in gold purchasing has not changed.

Extra Charges: Import Duty and GST

Along with the existing GST a further 12.5% import duty is levied in gold which further increases the price of gold. The combination of the two creates a large amount of taxes on gold making it hard for both customers and traders.

Purchasing Gold in 2025: Things to Remember

1. Get to know the taxes: In order to avoid concealed costs for gold, GST on gold and the making charges tend to be crucial to understand.

2. Validate the Invoice: Confirm that the jeweller has included a detailed explanation of costs and GST in the invoice given.

Conclusion

Gold GST in India has strengthened the gold economy in India in a way where the taxation has become more clear cut and equal though the tax has increased the prices for the consumers a bit. If you are purchasing 22 carat jewellery or 24 carat gold bars, it is vital to comprehend the GST consequences. As of 2025, the 3% GST on gold value and 5% GST on making charges still take on a significant role in the gold market. It helps to avoid significant losses when you track the market and understand its mechanics. This way you can invest wisely when the taxes change.

FAQs

1. What is the GST on gold in India in 2025?

In India, GST on gold stands at 3% of Gold value plus 5% of making charges for Jewellry. This is inclusive for all types of purchases done for gold like coins, bars or ornaments.

2. What is the GST on 22 carat gold jewellery?

For 22 carat gold jewellery it attracts 3% GST on the value of gold and an additional 5% GST is charged on the making of 22 carat gold jewellery.

3. What rate of GST is charged on 24 carat gold?

The 24 carat gold which is mostly used for coins and bars which incurs no making activities attracts 3 percent GST on its value.

4. Just like GST on gold jewellery, does GST on gold coins follow the same standard?

No, GST on gold coins is 3% of their value whereas gold jewellery is charged with an additional GST of 5% on making charges.

5. What is the GST imposed on gold ornaments?

When discussing gold ornaments, GST accounts to 8 percent of the overall value, as it includes charges related to the making of the piece. 6 percent is added directly to the value of gold, and the making charges are added onto the ornaments, and both are calculated separately.

6. Is GST on gold applicable on gold biscuits and bars?

Yes, there is a GST on bars and biscuits in gold, but it is only set at 3 percent. This is as there is no making charge to them because they are considered investment grade gold.

7. Generally, how much tax does a person pay while buying gold?

Usually gold is sold with a three percent gst on the value and five percent gst on the making. So it is quite clear how much is paid when buying crafted gold that is jewellery or ornaments.

8. How much of the gst on making charges and other exports are paid while making 22 carat and 24 carat gold?

22 carat gold is Djabarni than 24 carat gold and attracts a lesser percentage of three percent gst along with making charges which are paid at five percent, while 24 polite gold pays no making fees.

9. Is there an additional tax applicable on gold in India apart from the one detailed?

Yes, apart from the gst, there are a variety of additional taxes applicable, for example gold is imported into the country at a tax of twenty percent whereas gold bars import tax is set at 12 percent.

10. What effect does GST on gold have on the final payment?

A GST of 5% on the value of gold and 3% on making charges for jewelry, can increase the overall cost of gold, hence it is important to be mindful of the planning and timing of gold purchases.