The gold rate you looked up is not what you will pay. A jeweller's bill is the metal value, plus a making charge, plus 3% GST on both of those together. At a 12% making charge that lands 15.4% above the quoted rate — so 10 grams of 22K at ₹12,859 a gram bills about ₹1,48,341, not the ₹1,28,590 you were expecting.
Where the extra money goes
Published city gold rates — including the ones on this site — are indicative, pre-tax metal prices. Two things get added at the counter. The making charge is the jeweller's fee for turning metal into a finished piece, quoted either as a percentage of the gold value or as a flat rupee amount per gram. Then 3% GST is applied to the gold value and the making charge together, so you pay tax on the labour as well as on the metal.
A 10 gram bill, line by line
- Gold value: 10 g × ₹12,859 = ₹1,28,590
- Making charge at 12%: ₹15,431
- GST at 3% on the ₹1,44,021 sub-total: ₹4,321 — of which ₹463 is tax on the making charge alone
- Total billed: ₹1,48,341, which is ₹19,751 more than the rate alone suggested
That ₹12,859 is an illustrative 22K rate, in the range Indian cities have traded at recently — it is not today's quote. Rates move daily and differ by city, so check the live rate for your city and expect your rupee totals to differ from these. The percentages will not differ. The bill is gold value × (1 + making %) × 1.03, and the gold rate cancels straight out of the mark-up — the same making charge produces the same uplift in Delhi, Chennai or Mumbai, today or next Diwali.
The mark-up ladder
- 8% making charge: the bill is 11.2% above the quoted rate
- 12% making charge: 15.4% above
- 15% making charge: 18.5% above
- 20% making charge: 23.6% above
- 25% making charge: 28.8% above
Making charges are set by the jeweller, not by any regulator, and are commonly quoted anywhere between 8% and 25%. They are the one line on the bill you can actually discuss — the metal rate and the 3% are not up for debate. On 10 grams at ₹12,859 a gram, every single percentage point is ₹1,324 on the final bill once its own GST is counted, so pulling a quote from 15% down to 12% saves about ₹3,973. If you are quoted in rupees per gram, convert before you compare: ₹600 a gram is 4.7% at this rate, while ₹1,200 a gram is 9.3%.
Two things this arithmetic does not cover: studded pieces, where stones are weighed and billed separately on their own terms, and a small per-article hallmarking fee. Some jewellers also bill the making charge as a separate service line rather than folding it into the piece — ask which rate is applied to each line and add the invoice up yourself. Put your own sub-total through the GST calculator before you sign.
Where to go next
FAQs
Published gold rates are indicative pre-tax metal prices. Your bill adds the jeweller's making charge, then 3% GST on the gold and the making charge together. At a 12% making charge that is 15.4% above the quoted rate — on 10 grams of 22K at ₹12,859 a gram, ₹1,48,341 instead of ₹1,28,590.
Yes — the 3% applies to the gold value and the making charge together, not to the metal alone. In the 10 gram example above, ₹3,858 of the ₹4,321 GST sits on the gold and ₹463 on the ₹15,431 making charge. If your jeweller bills making as a separate line, ask what rate is applied to it and check the totals on the invoice.
They are set by the jeweller rather than by any regulator, so they vary — commonly quoted between 8% and 25% — which makes them the one part of the bill worth discussing. On 10 grams at ₹12,859 a gram, each percentage point you shave off is about ₹1,324 off the final bill. Plain and machine-made designs usually carry lower charges than intricate handwork, and a rupees-per-gram quote should be divided by the gram rate before you compare it with a percentage quote.
Educational information, not financial advice. Figures are illustrative and assume the stated return or rate; actual outcomes vary and aren't guaranteed. Run your own numbers before deciding.