Zakaat Rules 1 (4/5)
Question
Is Zakat applicable for Diamond or other precious metals/stones?
Answer
A:If diamonds or precious stone are purchased for trading purpose, i.e. with a clear intention of their resale, they are certainly subject to Zakah like any other item purchased with the same intention. But if a diamond or a precious stone is kept for personal use only, in that case Zakah is not obligatory on its value.
The Principle governing the levy of Zakah is that only those assets are Zakatable which either fall within the definition of money, or are the metals universally accepted as a medium of exchange like silver and gold. All other assets are not zakatable unless they are meant for trade and resale.
The precious stones, including diamonds, are, no doubt, very valuable assets. But if they are not purchased for trading, they are not subject to Zakah. This principle is based on a Hadith:
“There is no Zakah on a stone”
On the basis of the above, the overwhelming majority of the Muslim jurists are of the view that precious stones are not subject to the levy of Zakah unless they are acquired for the purpose of resale. There are, however, some jurists like Imam Ahmed who believe that all precious stones are liable to Zakah, even if they are kept for personal use.
Therefore, if somebody pays Zakah on the value of these stones, it will be free from all doubts and will promise more reward. But so far as the mandatory nature of the levy is concerned, the view of the majority is supportive of non- obligation of Zakah, because they are neither money nor a universally accepted medium of exchange. Moreover, the value of precious stones depends on their scarcity and rareness. They have no intrinsic value. Therefore they are like valuable antiques or manuscripts which, on account of their rareness, sometimes have more value than gold. Still, they are not subject to Zakah unless they are purchased for trade or resale.
Likewise precious stones may have more value than gold. Yet, the obligation of Zakah is not imposed if they are not meant for the trade. ”
(Contemporary Fatawa, Mufti Taqi Saheb, Pg. 101)
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