For many Indian hajj pilgrims, gold shopping in Saudi Arabia feels attractive because the base price closely tracks international benchmarks and retail making charges are typically transparent and low. India, by contrast, layers import duty and domestic levies on top of the global price, lifting the sticker price at home.
Since July 2024, India’s Union Budget cut the basic customs duty on gold to 6%—down from 15% previously—yet domestic retail still carries taxes and margins that keep final prices above spot. In Saudi Arabia, jewellery is generally subject to 15% VAT, while qualifying “investment” gold (≥99% purity, tradable in global markets) is zero-rated for VAT, which helps keep pure bullion competitive. Together, these tax differences explain why some pilgrims prefer to buy select items in the Kingdom and carry them back legally.
The short answer: how much gold can you bring?
Indian Customs permits arriving passengers to bring in up to 1 kilogram of gold (including ornaments) per person, subject to conditions. If you qualify for the concessional “eligible passenger” route (explained next), the duty is 6%; others pay 36%. These caps and rates are current as per Mumbai Customs’ August 12, 2025 update.
Who qualifies for the 6% concessional duty?
To use the concessional route, you must be an Indian passport holder or person of Indian origin who has stayed abroad for more than six months before arriving. Short trips home of up to 30 days during that period are ignored. Duty must be paid in convertible foreign currency at arrival. The concession is available up to 1 kg per passenger (including ornaments).
What if you don’t qualify—or you exceed the limit?
If you’re not an eligible passenger or you carry more than 1 kg, Customs will assess 36% duty on the excess and may initiate seizure/penalty if goods are undeclared. Under the Customs Act, undeclared dutiable goods are liable to confiscation (Section 111) and the passenger to penalty (Section 112)—so always declare rather than risk enforcement action.
The separate duty-free jewellery allowance (tiny, but useful)
Apart from the 1 kg cap (which is not duty-free), Indian residents returning after one year abroad get a small duty-free jewellery allowance:
- Men: up to 20 grams, capped at ₹50,000
- Women: up to 40 grams, capped at ₹1,00,000
Anything beyond this is dutiable. These figures come straight from India’s Baggage Rules, 2016 (Rule 5) and Customs FAQs.
What forms of gold are permitted?
Customs accepts jewellery, bars or coins within the 1 kg cap. Assessment is on the notified tariff value (as per CBIC notifications) and the applicable concessional/standard rate. Carry purchase invoices showing weight, purity and date. (Customs routinely reminds passengers that valuation follows notified tariff values, not only the shop bill.)
Declare it right: Red/Green channel, ATITHI app & currency rules
If you’re carrying dutiable gold, use the Red Channel and file a declaration. India’s ATITHI mobile app lets you pre-file your baggage and currency declaration before landing, cutting time at arrival. Also remember India’s currency disclosure thresholds: declare if you carry > US$5,000 in foreign currency notes, or > US$10,000 in total foreign exchange (notes + instruments).
Don’t forget Saudi-side rules before you fly out
Saudi Arabia requires a declaration when you depart or arrive if you carry cash, negotiable instruments, gold bars, precious metals, gemstones or jewellery valued at SAR 60,000 or more (or equivalent). You can file this online via ZATCA’s e-services. Non-declaration can trigger fines. Plan your shopping with that threshold in mind.
How taxes really compare: India vs Saudi Arabia (why prices diverge)
India: Post-Budget 2024, the basic customs duty is 6% on imported gold; domestic sales of jewellery are generally taxed under GST at 3% on the total transaction value at the retail stage (job-work scenarios differ). These layers keep India’s retail price above international spot, even after the duty cut.
Saudi Arabia: 15% VAT applies to most jewellery; however, investment-grade gold meeting purity/marketability conditions is zero-rated for VAT, so pure bullion often tracks global prices more closely (net of any dealer premium).
Practical packing checklist for Hajjis
Carry original invoices (weight/purity/date), keep jewellery unmixed (don’t blend old and new), and wearing items does not automatically make them duty-free if you exceed allowances—declare and pay to stay compliant. If you truly have only the small Rule-5 allowance, you may use the Green Channel; otherwise, go Red or pre-file on ATITHI to avoid delays.
Key takeaways (as of August 18, 2025)
- Cap: Up to 1 kg per passenger (including ornaments).
- Duty: 6% if you’re an eligible passenger; 36% otherwise.
- Tiny duty-free window: 20 g/₹50k (men) or 40 g/₹1 lakh (women) after one year abroad.
- Declare: Use Red Channel/ATITHI in India; declare ≥ SAR 60,000 in Saudi.
Sticking to these rules keeps your ziyaarat memories golden—and your arrival stress-free.
Mariya is the Senior Editor at Juris Hour. She has 5+ years of experience on covering tax litigation stories from the Supreme Court, High Courts and various tribunals including CESTAT, ITAT, NCLAT, NCLT, etc. Mariya graduated from MLSU Law College, Udaipur (Raj.) with B.A.LL.B. and also holds an LL.M. She started as a freelance tax reporter in the leading online legal news companies like LiveLaw & Taxscan.
