Gold & Precious Metals Import Duty Hiked to 10%: What It Means for Bullion Traders, Jewellers & Investors in India

The Government of India has officially increased the customs duty on several precious metal categories from 5% to 10%, effective from 13 May 2026. This major revision was announced by the Ministry of Finance through Notification No. 15/2026-Customs.

The amendment is expected to directly impact the bullion market, jewellery industry, importers, exporters, refiners, and retail investors across India. The revised duty structure applies to various precious metals and related goods under multiple tariff headings.

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Official Government Notification

The Ministry of Finance issued the amendment under the Customs Act, 1962 and Customs Tariff Act, 1975, increasing the customs duty from 5% to 10% for several specified entries in Table I of Notification No. 45/2025-Customs.

The notification clearly states that:

• Existing 5% duty entries have now been replaced with 10%
• The changes become effective from 13 May 2026
• Certain precious metal residues and spent catalyst materials are also included under the revised duty structure

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Which Precious Metal Categories Are Affected?

The revised notification covers several tariff classifications related to precious metals, including:

• Platinum group metals
• Precious metal residues
• Spent catalyst containing precious metals
• Precious metal ash and recovery materials
• Various goods under tariff headings 7107, 7109, 7110, 7111, 7112, and 7118

A new entry numbered 200A has also been inserted specifically for:

“Spent catalyst or ash containing precious metals” with a revised duty rate of 10%.

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Why Has the Government Increased the Import Duty?

The government generally revises customs duties on precious metals for several strategic and economic reasons:

1. Control Import Dependency

India is one of the world’s largest importers of gold and precious metals. Increasing duty helps reduce excessive imports and manage the trade deficit.

2. Support Domestic Refining & Recycling

Higher import duties encourage:

• Domestic bullion recycling
• Refinery expansion
• Recovery of precious metals from industrial waste and catalysts

3. Revenue Generation

Customs duty contributes significantly to government revenue collection, especially in high-value sectors like bullion and precious metals.

4. Rupee Stability & Forex Management

Reducing bullion imports may help conserve foreign exchange reserves and stabilize currency outflows.

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Impact on the Bullion Industry

Increased Landing Cost

Importers and bullion dealers will now face higher import costs due to the doubled customs duty.

This may result in:

• Higher bullion premiums
• Increased working capital requirements
• Pressure on margins for traders and jewellers

Price Increase in Jewellery

Retail jewellery prices may rise because higher duty directly increases the cost of raw precious metals.

Consumers may experience:

• Increased gold jewellery prices
• Higher making cost calculations
• Slightly lower festive demand in the short term

Impact on Refiners & Recyclers

Domestic refiners and recycling businesses could benefit because imported material becomes comparatively expensive.

Industries involved in:

• Gold recovery
• Catalyst recycling
• Precious metal extraction

may see increased business opportunities.

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Effect on Investors

Gold Investment Becomes Costlier

Physical gold investments such as:

• Gold bars
• Coins
• Jewellery

could become more expensive due to increased import duty.

Potential Rise in Domestic Gold Prices

If global prices remain stable while import duties rise, Indian domestic gold rates may trade at a premium compared to international markets.

Shift Towards Digital Gold & ETFs

Some investors may prefer:

• Gold ETFs
• Sovereign Gold Bonds
• Digital gold platforms

instead of physical bullion purchases.

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What This Means for Jewellers

Jewellers may need to:

• Recalculate pricing structures
• Manage inventory more carefully
• Reduce excess stock holding
• Pass some cost burden to consumers

Small and medium jewellers could particularly feel pressure due to reduced profit margins and increased operational costs.

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Effective Date of the New Duty

The notification clearly mentions that the amendment comes into force from:

13 May 2026

Businesses importing affected goods after this date will be subject to the revised 10% customs duty.

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Conclusion

The increase in customs duty on precious metals from 5% to 10% marks a significant policy shift for India’s bullion and precious metals sector. While the move may help control imports and strengthen domestic refining and recycling activities, it is also expected to increase costs for traders, jewellers, and consumers.

For bullion businesses, staying updated with tariff notifications and maintaining efficient inventory and pricing strategies will now become even more important in a rapidly changing regulatory environment.

Source: Government of India, Ministry of Finance Notification No. 15/2026-Customs dated 12 May 2026.