Gold Rate Comparison: UAE vs India

Tax on Gold Purchases In UAE vs India

In UAE, 0% tax is levied on gold bars and coins purchased that are of 99% purity. Whereas, when you buy gold jewellery, it’s not 99% pure, hence 5% VAT is applicable on gold jewellery purchases.

If you as an Indian buy gold jewellery abroad, the 5% VAT that you paid on your gold purchase will be refunded when you travel back to India. This is why many Indians prefer to buy gold jewellery and coins when visiting the UAE.

In India, 3% GST is levied on gold purchase regardless of the purity of gold bought. Along with that, an additional 5% GST is levied on making charges.

Import Duty on Gold In UAE vs India

UAE charges zero import duty on gold imported. This significantly reduces the cost borne by the retailer, which reduces gold prices for the general public.

In India, earlier 15% import duty was levied on gold imports, which is now reduced to 6%. The reason India imposes Import duty on gold is to reduce the impact of gold imports on the country’s trade deficit. India is the biggest consumer of gold and the excessive demand can negatively impact India's trade deficit.

Import Restrictions in UAE vs India

UAE has the upper hand in maintaining an efficient gold supply chain and has direct access to international markets, which keeps its gold prices lower than India’s.

India, with its trade restrictions, import duties, and taxes, has inflated the gold prices within the country.

Is It Affordable to Buy Gold In the UAE and Bring It Back to India?

If you buy gold from the UAE and bring it back to India, you will have to pay import duty above a certain limit. Women can carry 40 grams of gold duty-free, while men can carry up to 20 grams of gold per visit.

If you exceed this limit, you will have to pay import duty of around 3-10% on the Indian value of the gold brought.