GST On Gold Jewelry: Rate & Calculation Formula

The Goods and Service Tax came into existence on 01st July 2017. Since then the government fixed various GST rates for various items and services. Also, the GST rates on such items and services are revised at various times as per the suggestions from GST Council. The GST council is an appointed committee by the government of India. Thus, it suggests and revises the GST On Gold Jewellery, cars, restaurant, books, and rent. Also, it is applicable to other electronic items like mobile phones, air conditioners, laptops, etc. Let us see the various GST rates on these items and services.

Gold Rate Calculator with GST

Our below GST calculator can help you determine the gold rate with GST. This calculator typically require you to input the weight of the gold, the current market price per gram, and the making charges. The tool then calculates the total cost including GST.

Weight (in grams):


Gold Rate (per gram):


Making Charges:


GST Percentage (%):


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Rate of GST On Gold Jewelry

Let us understand how GST is calculated on Gold in India. Thus, you can find out the final price of the jewelry with GST. The current Goods and Service tax rate on Gold is: 3% (CGST = 1.5%; SGST= 1.5%). The GST rate @3% is applicable on the final value of Gold jewelry including the making charges. However, the making charges can be shown separately on the invoice.

The formula to calculate the final price of Gold Jewelry is:

Final price of the jewellery = Price of (22 KT or 18 KT) gold x (Weight in grams) + Making charges + GST at 3% on (Price of jewellery + making charges).

Illustration: If you wish to buy 15 grams of 22 Karat Gold and the price of 22 Karat Gold listed at the jewelers’ shop is Rs. 45,000 per 10 grams. Similarly, the jeweler-making charges are 15% for your type of jewelry. Here is how the Jeweler will calculate the final jewelry price :

1. Value of 10 grams of 22 Karat Gold = Rs. 45,000
2. Value of 1 gram of 22 Karat Gold = Rs. 45,000/10 = Rs. 4,500
3. Value of 15 grams of 22 Karat Gold you want to buy = Rs. 4,500 * 12 = Rs. 54,000
4. Making charges on the jewellery item = 15% of Rs. 54,000 = Rs. 8,100
5. The total value of jewelry excluding tax = is Rs. 54,000 + Rs. 8,100 = Rs. 62,100.
6. GST @ 3% on the total value of jewelry = 3% on Rs. 62,100 = Rs. 1,863

Thus, the final value of jewellery = Rs. 62,100 + Rs. 1,863 = Rs. 63,963

What is Karat In Gold?

Gold jewelry is available in various Karats (KT) in India. Thus, Karat is the measure of the purity of gold. Hence, 24KT is the most purified form of gold. However, it is too soft to be used for creating jewellery items. Therefore, the most popular form of gold available in jewellery is 22KT which contains 91.6% gold.

Read: SAC codes under GST 2022

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Understanding Gold Rates and GST in India

Gold has always been a significant part of Indian culture, not just as a symbol of wealth and prosperity but also as a preferred investment. However, understanding the intricacies of gold pricing, especially with the inclusion of GST, can be quite complex. This article aims to clarify various aspects of gold rates and GST, addressing common queries and providing a comprehensive guide.

What is GST on Gold?

GST, or Goods and Services Tax, is a value-added tax levied on most goods and services sold for domestic consumption. In India, the GST on gold is set at 3%. This tax is applicable to the value of the gold itself, and additional charges such as making charges also attract GST.

Calculating GST on Gold

To calculate GST on gold, you need to consider both the price of the gold and the making charges. Here’s a step-by-step guide:

1. Determine the Price of Gold: This is usually quoted per gram. For example, if the price of 24-carat gold is ₹5,000 per gram, and you are buying 10 grams, the cost is ₹50,000.
2. Add Making Charges: Making charges can vary but let’s assume it is 10% of the gold price. For ₹50,000 worth of gold, the making charges would be ₹5,000.
3. Calculate GST: GST is 3% on the total of the gold price plus making charges. So, GST = 3% of (₹50,000 + ₹5,000) = ₹1,650.

Thus, the total cost would be ₹50,000 (gold price) + ₹5,000 (making charges) + ₹1,650 (GST) = ₹56,650.

Gold Rate Today with GST

The gold rate fluctuates daily based on market conditions. To find the current gold rate including GST, you can use online calculators or check with local jewelers. For instance, if the gold rate today is ₹5,000 per gram, including GST, it would be ₹5,150 per gram.

GST on Different Carats of Gold

• 24 Carat Gold: This is pure gold and attracts a GST of 3%.
• 22 Carat Gold: This is 91.6% pure gold mixed with other metals. The GST remains 3% on the total value.
• 18 Carat Gold: This is 75% pure gold. The GST is still 3% on the total value.

Gold Jewellery GST Rate

When purchasing gold jewelry, the GST is calculated on both the gold value and the making charges. For example, if you buy a gold necklace weighing 20 grams at ₹5,000 per gram, and the making charges are ₹10,000, the GST would be 3% of (₹1,00,000 + ₹10,000) = ₹3,300.

How to Calculate GST on Gold Jewellery

To calculate GST on gold jewelry:

1. Calculate the total value of the gold: Weight in grams × price per gram.
2. Add making charges: This varies by jeweler.
3. Apply GST: 3% on the total value (gold price + making charges).

GST on Gold Coins

Gold coins also attract GST at the rate of 3%. For example, if you purchase a 10-gram gold coin at ₹5,000 per gram, the cost would be ₹50,000 plus 3% GST, totaling ₹51,500.

GST on Gold in Different Cities

Gold rates can vary slightly from city to city due to transportation costs and local taxes. However, the GST rate remains consistent at 3% across India. For example, the gold rate in Mumbai might be slightly different from that in Delhi, but the GST calculation method remains the same.

Common Queries about GST on Gold

• How much GST on gold?: The GST on gold is 3%.
• How to calculate GST on gold?: GST is calculated as 3% of the total value of the gold plus making charges.
• What is the GST rate for gold jewellery?: The GST rate for gold jewellery is 3% on the total value (gold price + making charges).
• Is there GST on gold coins?: Yes, gold coins also attract a GST of 3%.

Gold Rate Today in Various Cities

• Mumbai: The gold rate in Mumbai today for 22 carat gold is approximately ₹4,800 per gram, including GST.
• Delhi: In Delhi, the rate is around ₹4,820 per gram for 22 carat gold, including GST.
• Chennai: Chennai’s gold rate is about ₹4,850 per gram for 22 carat gold, including GST.

Conclusion

Understanding the gold rate and GST is crucial for making informed purchasing decisions. Whether you are buying gold jewelry, coins, or bars, knowing how to calculate the total cost including GST can help you budget effectively and avoid surprises. Always check the current gold rates and use reliable calculators to ensure you are getting the best deal.

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