Certainly one of the world’s most visited destinations for travelers and investors alike, Dubai recorded close to 10 million international visitors between January and July 2023. Many of these visitors came to buy Dubai gold, and that begs the question: Why is Dubai gold cheaper when compared to other countries around the world? Let’s take a look at this phenomenon.
The city of gold has so much more to offer visitors than just a shopping experience. It’s easy to see why Dubai has become such an iconic destination for tourists and ex-pats. Gold has always fascinated people and has the power to draw you into its beauty and luster.
Dubai gold and gold jewelry are the cheapest in the world as they charge the intrinsic value of gold. They only have a value-added tax levied on the gold price, which keeps the price low compared to countries that add other taxes to the jewelry price tag.
It’s common knowledge that gold is a great investment, and if you love gold as much as we do, then you’ll be excited to know that it’s also cheaper in Dubai.
Why Is Dubai Gold Cheaper?
The price of gold fluctuates often and can rise or fall dramatically. It also tends to outperform other investments over the long term. However, investing in gold can be challenging. You need to find the best place to buy gold or which platform to buy gold from.
Before the introduction of Value Added Tax (VAT) in Dubai in 2018, the city of gold was well known for its cheap gold and duty-free shops at the airport.
However, the introduction of a 5% levy tax has not deterred people away from Dubai’s precious metals. Dubai gold is still considered the cheapest in the world.
For tourists, buying gold in Dubai is even cheaper as they can claim VAT refunds in the UAE. In Dubai, the VAT is the only form of tax added to gold jewelry compared to other countries that charge goods service tax (GST) and excise duty on top of VAT.
The Deira Gold Souk in Dubai is known as the oldest and largest gold market in the world. Dubai’s gold souk tries to live up to its name of the city of gold, which is an intricate maze of pathways lined with stores displaying the beautifully crafted gold jewelry unlike anything else in the world.
Tourists can rest assured of the legitimacy and validity of gold when buying from the gold souk markets and anywhere in Dubai, for that matter, as the Dubai government directly regulates the prices.
The three main reasons why it is cheaper to buy Dubai gold are:
- Dubai only levies a 5% tax on gold jewelry, as regulated by the government.
- Tourists can claim a VAT-refund when leaving Dubai with the merchandise.
- A lower cost of labor in the manufacturing of jewelry.
Did you know?
Dubai carries a zero tax regime on imports of raw gold materials like gold bars and TT bars.
Is Gold In Dubai Pure?
There are different levels of purity in gold. Pure gold can be more difficult to work with and is softer when pure compared to gold that is mixed with a percentage of other alloys to harden the gold. The purity of gold can easily be seen by the color of the metal.
A karat measurement signifies the purity of the gold; for example, if you buy 18kt gold, it is 75% gold and 25% other metals. Gold-stamped 24kt is the purest form of gold you can find.
Color will point out the purity of gold; that’s why Dubai gold always looks different from gold elsewhere in the world. Dubai sells 24kt gold that glimmers yellow compared to the darker gold you find in other countries as they have a percentage of copper melted with the gold.
Another reason why people will buy Dubai gold is because you don’t have to worry about the quality and purity of gold here. The government regulates gold jewelry sold by merchants to ensure you get authentic gold items.
It is also mandatory that jewelry shops carry a gold purity hallmark in Dubai. The gold purity hallmark certificate authenticates the gold; it provides customers details of the karats, the weight of the gold item, and labor costs. This certificate can allow the buyer to authenticate its value anywhere in the world.
Dubai is determined to keep its title of city of gold and continue to maintain its long-term vision of establishing Dubai as the global trading hub of gold. There, Dubai municipality has armed itself with ultra-modern laboratory equipment with highly trained technicians that carry out strict random inspections of retail stores as well as wholesalers.
Can I Buy Dubai Gold Online?
Yes, you can buy Dubai gold online. There are plenty of online gold shops where you can buy gold bars and coins. The only thing you need to be careful about is shipping costs. Some shops will charge you an outrageous amount just to get the gold to you.
Before buying gold online, make sure you know how much shipping is and how long it will take. You also want to make sure the shop is legitimate.
Do research on the stores you are buying from, check the internet for complaints or scam reports, and you can even call the number on the website and confirm the validity of the store.
Do You Have To Declare Gold Bought In Dubai?
Depending on your budget and how carried away you get when purchasing the precious yellow metal, you may or may not have to declare gold when returning home.
This is a question that often comes up in relation to importing gold into the US. In general, you don’t have to declare gold unless it’s more than $10,000. Unfortunately, there are no specific rules for importing gold into Dubai.
The rules for importing and exporting gold depend on the airport’s customs agent. If you have a lot of gold, it’s always better to be safe than sorry and declare it. There have been a few reports of customs agents confiscating gold because it was above the allowed amount. Declaring your gold is a simple process. You just fill out a form and tell them how much gold you have.
Each country has its own rules and regulations for the quantity of gold that you are allowed to bring home. Always check with your country of origin what the rules and regulations are for bringing home precious metal in the form of bullion, coins, and medallions, and what the rules are for jewelry.
Tips For Buying Gold In Dubai
Dubai is known for its bartering trade. You might not be able to get away with this in the bigger jewelry chain shops or online, but if you are visiting Dubai, the bartering at the Gold Souk is a must experience on its own.
Here are a few tips on the best time to buy gold in Dubai.
- Weekends are the best time to buy Dubai gold as this is the most stable time of the gold price. The price will not be traded on international exchange and will only change again on a Monday morning. So DO buy your gold on a Saturday or Sunday.
- Groups that sell gold and jewelry fix gold rates twice a day while stock markets are open. So check the price of gold before making any decisions.
- You are allowed to request to see the gold purity hallmark when buying gold from any store in Dubai. So make sure to ask for it before purchasing your item.
- Negotiations are a daily occurrence here, so barter the price and shop around before making your purchase; you never know, you may cut the price in half.
Conclusion
Dubai is renowned for its pathways of stores dripping in gold. It is the hub of the UAE for the gold trade. With a booming increase of stores, refineries, and jewelers, Dubai is the place to barter and purchase gold for cheaper than you will find anywhere else in the world.