GST on gold is 3% on the value of the metal — bullion, coins, bars and the gold in jewellery (HSN 7108 / 7113). Making charges (job work to convert gold into ornaments) are taxed separately at 5% (SAC 9988). On a typical jewellery bill the blended rate works out to a little over 3%. Both rates have stayed the same since 1 July 2017 and were not changed by the GST 2.0 rationalisation effective 22 September 2025.
GST Rates on Gold, Silver & Precious Metals
The GST rate for each category of precious metal and stone, with the applicable HSN / SAC code.
| Item | HSN / SAC | GST Rate |
|---|---|---|
| Gold bars / bullion / coins | 7108 | 3% |
| Gold jewellery | 7113 | 3% |
| Gold ornaments studded with stones | 7113 | 3% (gold portion) |
| Making charges (job work) | 9988 | 5% |
| Silver bars / coins | 7106 | 3% |
| Silver jewellery | 7113 | 3% |
| Platinum bars | 7110 | 3% |
| Rough diamonds | 7102 | 0.25% |
| Cut & polished diamonds | 7102 | 1.5% |
| Gold scrap | 7112 | 3% — RCM if an unregistered seller supplies a registered dealer |
Rates per Notification 01/2017-CT(R). GST 2.0 (eff. 22 Sep 2025) restructured most goods into 5%/18% slabs but left gold, silver and diamonds untouched.
The two-slab GST 2.0 reform (5% / 18%, plus 40% on demerit goods) that took effect on 22 September 2025 removed most 12% and 28% rates — but gold, silver, jewellery and diamonds keep their existing special rates. Gold remains 3% and making charges remain 5%.
How GST Is Calculated on a Jewellery Purchase
Say you buy a 20 g gold necklace at ₹7,000/g with making charges of ₹500/g. GST applies at 3% on the gold value and 5% on the making charges, billed on separate invoice lines.
Bill components
GST & total payable
Here the effective GST on the total bill is about 3.13% (₹4,700 ÷ ₹1,50,000). It rises slightly as making charges form a larger share of the bill, because those are taxed at 5% rather than 3%. Always check the invoice shows gold value and making charges as separate lines with GST on each.
What a GST-compliant jewellery bill must show
- Gold metal value — weight, purity (22K / 24K), per-gram rate and total gold value
- Making charges — as a per-gram amount or a percentage of gold value, on a separate line
- CGST + SGST (intra-state) or IGST (inter-state), shown on gold value and making charges separately
- The jeweller's GSTIN, invoice number and HSN / SAC codes
- Total amount payable including all taxes
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GST on Old-Gold Exchange
When you swap old jewellery for new, GST is generally charged only on the net amount payable, not the full value of the new piece:
- The jeweller buys your old gold — a purchase from an unregistered individual, so you are not charged GST on it
- GST is levied on the net (new jewellery value − old gold value) where the exchange is structured as a net transaction
- The jeweller should issue a purchase voucher for the old gold received and a tax invoice for the new jewellery sold
Treatment of old-gold exchange can differ where the jeweller bills the full new value and shows the old gold as a separate deduction. Insist on both documents — a purchase voucher for the old gold and a tax invoice for the new jewellery — so the GST charged is correct and traceable.
ITC for jewellers vs buyers
| Party | ITC on gold GST? | Reason |
|---|---|---|
| Registered jeweller (for resale / business) | Yes | Gold is stock-in-trade; ITC under Section 16 if invoice is in GSTR-2B |
| Individual buyer (personal jewellery) | No | Personal consumption — no ITC |
| Bank / dealer selling gold coins | Yes | If bought for resale or business use |
ITC is available only to a GST-registered person using the gold for business; ordinary buyers cannot claim it.
Reverse charge on gold scrap
Gold scrap falls under HSN 7112 and is taxed at 3%. Where an unregistered person sells scrap gold to a registered dealer or refiner, the buyer pays that 3% under the Reverse Charge Mechanism and issues a self-invoice, instead of the seller collecting it. Where both parties are registered, ordinary forward charge applies.
An individual selling their own gold is not making a supply in the course of business, so they collect no GST. If they sell it to a registered dealer as scrap, the dealer accounts for the tax under RCM. Ask for a purchase document either way — and note that any gain on the sale can attract capital-gains income tax separately. GST and income tax are different questions.
Customs Duty on Top of GST
The 3% GST is a domestic tax. Imported gold also bears customs duty and an Agriculture Infrastructure and Development Cess (AIDC), and GST at 3% applies on the landed (assessable + customs) value — so total tax on imported gold is higher than on domestically sourced gold.
- Basic customs duty on gold — check the rate in force at the time of import (revised periodically in the Union Budget)
- AIDC is levied in addition to customs duty
- 3% GST is charged on the value after customs duty, i.e. the landed cost
Basic customs duty and AIDC on gold are adjusted from time to time in the Budget and by notification, and the split between the two has changed in recent years. Confirm the current rate on the CBIC customs tariff before relying on a figure for an import.
Historical background
Before GST (pre-July 2017), gold carried about 1% excise duty on jewellery manufacture plus state VAT (roughly 1–1.2%). GST replaced both with a single 3% rate. The 5% rate on making charges was set below the standard job-work rate as a concession to the jewellery sector. Customs duty on imports continued separately.
- Rates & notifications: gst.gov.in
- CBIC-GST: cbic-gst.gov.in
- Gold / jewellery 3%: Notification 01/2017-CT(R), Schedule V (HSN 7108 / 7113)
- Making charges 5%: job work under SAC 9988
- Customs duty & AIDC on gold: cbic.gov.in customs tariff
Disclaimer: This guide is general information based on the law and notifications in force when it was last updated. It is not professional advice for your case — rates, thresholds and due dates change, so check the current position with the official source before you act on it.