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No, it does not have to be stored in the EU, but if it is outside the EU it must comply with the conditions that allow such a transfer. (EU GDPR CHAPTER V)
Email falls under GDPR - "any information relating to an identified or identifiable natural person" (EU GDPR Article 4 definition of...
There are two aspects to this.
If Google offer Gmail as a service in the EU then the service needs to be GDPR compliant.
If an EU based organisation chooses to use Google's service, even the free one, then they need to ensure they are compliant to GDPR, as data controller and data processor.