How gold making charges really work
Two jewellers can quote the same gold rate and still charge you very different amounts for the same chain. The difference hides in three line items: making charge, wastage, and how GST is applied. Here is how to read a bill properly.
The four components of any gold bill
- Gold value — weight × rate for that purity. This should be the biggest number.
- Making charge — the labour of turning metal into a piece. Charged as a % of gold value, or flat ₹/gram.
- Wastage — metal notionally lost in manufacturing. Often 5–12% at traditional jewellers.
- GST — 3% on gold jewellery in India, applied on the total.
A worked example
A 10-gram 22Kt chain at a ₹15,700/g 24Kt rate. At 916 fineness the metal is worth about ₹14,381/g.
| Line | Typical jeweller | ABRAF approach |
|---|---|---|
| Gold value (10g) | ₹1,43,810 | ₹1,43,810 |
| Making charge | 18% → ₹25,886 | Published %, shown in ₹ |
| Wastage | 8% → ₹11,505 | ₹0 |
| GST 3% | ₹5,436 | On a smaller base |
| Total | ₹1,86,637 | Materially lower |
The metal is identical. Roughly ₹37,000 of that bill is not gold at all.
What is a fair making charge?
It depends on craft. A plain bar should be near-zero labour; an intricate bridal piece is genuinely skilled work. As a rule of thumb in India:
- Fine gold bars: 2–3%
- Plain chains and simple pieces: 8–15%
- Ornate / handcrafted jewellery: 25–35%
- Large online brands: frequently 45–55%
ABRAF charges 3% on 1g and 10g bars, 2% on 100g bars, and roughly 30–35% on ornaments — published as a rupee amount on every product page, never as a hidden percentage.
Three questions to ask before you buy
- What is the fineness, and what rate are you applying to it?
- What is the making charge in rupees, not percent?
- Is there any wastage, and why?
If a jeweller cannot answer all three in under a minute, the bill is doing work the salesperson would rather you not see.