The gold rate on a shop's board is only part of what you pay for jewellery. The rest is the making charge, sometimes a wastage charge, the cost of any stones, and GST. Once you know how each one is worked out, comparing shops becomes easy.
What goes into a jewellery bill
- Gold value: the net gold weight multiplied by the shop's rate per gram for that purity.
- Making charge: the jeweller's charge for design and labour.
- Wastage or value addition (VA): an extra percentage some shops add, common in South India. Many shops include it in the making charge instead.
- Stones and other materials: priced separately, by weight or per piece.
- Hallmarking charge: a small charge per piece.
- GST: 3% on the total.
How making charges are quoted
Shops quote making charges in one of three ways:
- A percentage of the gold value, for example 12%. This is the most common.
- A fixed amount per gram, for example ₹800 per gram.
- A flat amount per piece, usually for small or light items.
Making charges vary a lot between shops and designs. Plain chains and simple bangles usually carry the lowest charges; detailed, handmade or antique-finish work the highest. Because the gold rate is nearly the same everywhere, the making charge is where most of the price difference between shops comes from.
A worked example
Say a 22K chain has a net weight of 10 grams and the shop's 22K rate is ₹13,000 per gram.
- Gold value: 10 g × ₹13,000 = ₹1,30,000
- Making charge at 12%: ₹15,600
- Taxable value: ₹1,45,600
- GST at 3%: ₹4,368
- Total: ₹1,49,968, or about ₹14,997 per gram all in.
If the same shop charged ₹800 per gram instead, the making charge would be ₹8,000 and the total ₹1,42,140. Try your own numbers in the bill calculator.
How GST applies
When you buy a finished piece, GST is charged at 3% on the whole bill, including the making charge. The rules are different when a jeweller makes a piece from gold you supply (job work), so ask the shop how it will bill you in that case.
Stones are not gold
Stones, beads, lac and enamel should be weighed separately and never charged at the gold rate. BIS guidelines require the bill to show the net gold weight, so check that the gold value is worked out on the net weight, not the gross weight.
"Zero making charge" offers
Festival offers often cut or waive making charges. They can be genuine, but check:
- the gold rate the shop is using that day, against the market rate
- whether a wastage or VA charge has been added instead
- whether the offer covers only some designs
Compare the final price per gram, all in, rather than the headline offer.
Making charges and resale
When you sell or exchange jewellery later, shops pay for the gold, not for the making charge, and they usually deduct a percentage for melting and testing too. Ask about exchange and buyback terms before you buy, and see what old gold is worth with the old gold calculator.
Questions to ask at the counter
- What is your rate per gram for this purity today?
- What is the making charge, and is it a percentage or per gram?
- Is there a separate wastage or VA charge?
- What is the net gold weight, without stones?
- Is the hallmarking charge shown separately?
- What do you deduct if I exchange or sell this piece later?
Sources
- Bureau of Indian Standards, Brief on Hallmarking Scheme, updated 1 October 2026 (what the bill must show)
- Central Board of Indirect Taxes and Customs, GST portal (GST rates)