Zakat on Diamonds and Jewelry

Diamonds, jewelry and other precious stones are highly valuable. The motive of their purchase and possession may be different for different persons. Hence, with the change in conditions, the injunction should also change. The Fifth Fiqh Seminar reached to the following conclusions in this regard.

10.1 Zakat on the diamonds, etc. will be obligatory on the purchaser if purchased for commercial purposes.

10.2 Zakat will not be due on diamonds purchased for using as ornaments.

10.3 A small diamond is much costlier than even gold and some people purchase them to convert their wealth and thus preserve their cash for certain consideration. These diamonds can be readily cashed at the jewelers' shops and often they fetch higher price than their purchase price. Therefore, they are not only the means of preservation of wealth but a means of profitability as well.

This aspect of the issue also came under deliberation at the Seminar that a cash amount of millions of rupees can not only be preserved through purchase of some diamonds but they can be again converted into ready cash anytime.

A. The first opinion was that diamonds are not vestigial items like gold or silver, nor the purchaser trades in jewels, nor he has the intention of its trade at the time of purchasing nor has any intention of making it a commercial commodity, hence, it does not fall in the category of Naami. Therefore, under such conditions Zakat will not be obligatory on the possessor.

B. The second argument was that diamonds are not considered as a necessity of life but a means of preserving the accumulated wealth and a means of profit as well. Therefore, Zakat will be obligatory on these diamonds.

C. Keeping in view all the arguments many participants opined that under the former condition Zakat is not obligatory *.1 But an equally large number of participants argued that non-obligation of Zakat on this hoarded wealth will deprive the poor of their share of income and insisted on Zakat being obligatory on diamonds.**