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GST on Gold in India: What You Need to Know

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Jul 12, 2025

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GST on Gold in India: What You Need to Know

IN THIS ARTICLE:

What is GST & How Does It Apply to Gold?

Gold has been an integral part of Indian culture and investment strategy for centuries. However, since the implementation of the Goods and Services Tax (GST) in July 2017, the taxation landscape for gold purchases has undergone significant changes.

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Understanding these changes is crucial for both investors and consumers who buy gold regularly.

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What is GST & How Does It Apply to Gold?

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Goods and Services Tax (GST) is a comprehensive indirect tax that replaced multiple taxes like VAT, excise duty, and service tax. It's a destination-based tax levied on the supply of goods and services throughout India.

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For gold, GST applies at different stages:

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• Manufacturing level- When gold is processed into jewellery or coins.

• Retail level– When consumers purchase gold products.

• Import level- When gold is imported into India.

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The key principle is that GST is charged on the value added at each stage of the supply chain, making it a more transparent taxation system.

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GST Rate Structure for Gold Products

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Primary GST Rates

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The design of the GST structure for gold includes specific rates for various components.

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Impact on Different Types of Gold Purchases

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Physical Gold Products

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<div align="left">
<table style="border: none; border-collapse: collapse; width: 100%;" class="fr-table-selection-hover">
<tbody>
<tr>
<td style="border: solid #000000 1pt;">
Gold Product  Type
</td>
<td style="border: solid #000000 1pt;">
GST Structure 
</td>
<td style="border: solid #000000 1pt;">
Key Features 
</td>
<td style="border: solid #000000 1pt;">
Best For
</td>
</tr>
<tr>
<td style="border: solid #000000 1pt;">
Gold Coins
and Bars
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Only 3% GST on gold value 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No making charges 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No wastage charges
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Lower overall tax burden 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Standard purity guarantee 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Easy liquidity
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
Investment purposes
</td>
</tr>
<tr>
<td style="border: solid #000000 1pt;">
Gold Jewellery  and
Ornaments
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
3% GST on gold content 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
5% GST on making charges 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
5% GST on wastage
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Higher total cost due to  craftsmanship 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Cultural and aesthetic  value 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Lower gold content per  rupee
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
Personal use and cultural purposes
</td>
</tr>
<tr>
<td style="border: solid #000000 1pt;">
Gold Artifacts and
Decorative  Items
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
3% GST on gold content
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
5% GST on making charges
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Higher artistic charges
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Making charges significantly higher 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
GST on artistic value addition
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Speciality designs
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
Decorative and collectable purposes
</td>
</tr>
</tbody>
</table>
</div>

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Digital Gold Purchases

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<div align="left">
<table style="border: none; border-collapse: collapse; width: 100%;">
<tbody>
<tr>
<td style="border: 1pt solid rgb(0, 0, 0); width: 16.5742%;">
Digital Gold Type
</td>
<td style="border: 1pt solid rgb(0, 0, 0); width: 27.9729%;">
GST Structure 
</td>
<td style="border: solid #000000 1pt;">
Key Features 
</td>
<td style="border: solid #000000 1pt;">
Best For
</td>
</tr>
<tr>
<td style="border: 1pt solid rgb(0, 0, 0); width: 16.5742%;">
Gold ETFs  (Exchange Traded Funds)
</td>
<td style="border: 1pt solid rgb(0, 0, 0); width: 27.9729%;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No GST on purchase  or sale 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Only expense ratio  applies 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Brokerage charges  separate
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Most tax-efficient investment 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
High liquidity 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No storage concerns
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
Large-scale investment
</td>
</tr>
<tr>
<td style="border: 1pt solid rgb(0, 0, 0); width: 16.5742%;">
Digital Gold  Platforms
</td>
<td style="border: 1pt solid rgb(0, 0, 0); width: 27.9729%;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
3% GST on gold value
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No making charges
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Storage: 18% GST (if  applicable)
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No making charges
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Instant transactions
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Small investment amounts possible
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
Regular
small investments
</td>
</tr>
<tr>
<td style="border: 1pt solid rgb(0, 0, 0); width: 16.5742%;">
Gold Mutual Funds
</td>
<td style="border: 1pt solid rgb(0, 0, 0); width: 27.9729%;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No GST on investment 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Capital gains tax on  redemption 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Expense ratio  included
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
<ul>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Professional management 
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
No direct gold ownership
</li>
<li style="list-style-type:disc;font-size:11pt;font-family:Arial,sans-serif;">
Diversified exposure
</li>
</ul>
</td>
<td style="border: solid #000000 1pt;">
Portfolio
diversification
</td>
</tr>
</tbody>
</table>
</div>

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Download the Jar app to start your digital gold saving journey.

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GST Impact on Gold Imports

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India imports approximately 70–80% of its gold requirements, making import taxation crucial for overall pricing.

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Import Structure

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• Basic Customs Duty: 12.5% on gold imports

• Agriculture Infrastructure and Development Cess: 2.5%

• GST on Imports: 3% on landed value (including customs duty)

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