Gold Tax in Pakistan: What Buyers & Sellers Pay

In most retail gold sales in Pakistan, there is no VAT or GST charged on the metal itself — the price you pay is the Sarafa rate plus making charges, with no separate tax line on the invoice. This is one of the main differences between Pakistan and its neighbours: India charges 3% GST on gold, while Pakistan does not charge an equivalent retail tax on the metal.

That does not mean the gold trade is untaxed. Import duties and taxes apply when gold enters the country, and those costs are reflected in the Sarafa rate — so the tax is in the price, not on the invoice. And jewellers, like all businesses, pay income tax on their profits.

Making charges (mazdoori) are the jeweller's fee for turning gold into jewellery, and they are the part of the price you negotiate. There is no standard tax treatment for making charges at the retail counter in most cases — but always ask for the full breakdown on the invoice, and make sure the invoice shows the weight, karat and making charges separately.

The invoice matters more than the tax: it is your proof of purchase, your record for resale, and your protection if the purity is ever questioned. A jeweller who will not give a proper invoice is a jeweller to avoid, whatever the price.

When you sell gold to a jeweller in Pakistan, the shop buys at the day's Sarafa rate minus a small margin. For individuals selling family gold, there is no specific capital gains tax on personal gold sales in the way some countries levy — but large, frequent sales can be treated as trading income by the tax authorities, and dealers are taxed on their trading profits as business income.

Keep your purchase invoices. If you sell a large amount, the paper trail protects you — it shows the gold was bought legitimately and when. For very large transactions, get professional tax advice before selling.

Pakistan imports most of its gold, and import duties and regulatory charges affect the Sarafa rate — which is why the Pakistani rate can sit above the straight international conversion. The duty regime changes with government policy, so the premium over the international price varies over time.

Travellers bringing gold into Pakistan should check the current customs rules before travelling: there are limits on how much gold can be brought in duty-free, and undeclared gold above the limit can be confiscated. The rules change, so check the FBR's current passenger baggage rules, not an old blog post.

For the ordinary buyer in Pakistan, gold tax is simple: no VAT on the metal at the counter, making charges to negotiate, and an invoice to keep. For dealers and large traders, the picture is more complex — income tax on margins, import duties, and FBR scrutiny of large transactions.

Because the rules change often and enforcement varies, this guide states the general picture rather than promising specific rates. For a large purchase, sale or import, check the current FBR rules or ask a tax adviser — the cost of advice is small compared with the cost of getting it wrong.