Since the implementation of GST in July 2017, the tax structure on gold jewellery in India has been standardised across all states. However, many buyers remain unclear about how the two separate GST components work and what they should see on their invoice. Here is a complete explanation.
GST on the Gold Metal Value: 3%
A flat 3% GST applies to the value of the gold metal itself, regardless of purity or form. This applies to jewellery, gold coins, gold bars, and any other form of refined gold. If you are buying a 10-gram 22K necklace and the gold value (at today's 22K rate) is ₹1,42,000, the GST on the metal is ₹4,260.
GST on Making Charges: 5%
Making charges — the fabrication labour component — attract a separate 5% GST. If the making charges on the same necklace are ₹1,200 per gram (₹12,000 for 10 grams), the GST on making charges is ₹600. The total GST on this transaction is ₹4,260 + ₹600 = ₹4,860.
What Your Invoice Should Show
A legal GST invoice from a registered jeweller must separately state: gold weight and purity, gold value, making charges (per gram or total), GST on gold (3%), GST on making charges (5%), and the total amount payable. If a jeweller presents a single line item without this breakdown, insist on a detailed invoice — it is your legal right and the jeweller's statutory obligation. An invoice without a GST breakdown is also a red flag for unregistered or non-compliant traders.