The Nisab for Gold and Evaluating Cash Based on its Worth

Posted on: 25 April 2019

Gold’s nisab is 20 gold dinars. And silver’s is 200 dirhams. (Mughni al-Muhtaj 2/92-93; Sharh al-Muhadhdhab 6/2) Today, scholars have calculated these amounts. Some consider one dinar equal to 4.25 grams. This calculation is mentioned by Dr. Muhammad al-Zuhayli in al-Mu’atamad 2/34, Dr. Yusuf al-Qaradawi in Fiqh al-Zakah 1/260-61, and Dr. Rafiq Yunus al-Misri in Fiqh al-Mu’amalah al-Maliyyah 78. According to this calculation, gold’s nisab is around 85g. (20 dinars x 4.25g = 85g) According to another calculation, one dinar equals 4.8g. Accordingly, another calculation would be about 96g. (20 dinars x 4.8g = 96g)

Today, gold is often measured in troy ounces. One troy ounce is equal to 31.103g. Therefore, the nisab for gold is approximately 2.73 troy ounces. (85g / 31.103g = 2.73oz)

When considering zakah on actual gold such things like its millesimal fineness and the issue of the "maghshushah" needs to be considered.

When considering currencies based on the value of “naqd” (i.e. deciding whether to use gold or silver), some have preferred silver. Reason being, silver’s value is less than gold. Therefore, more people will be obliged to pay zakah. This will be in the poor’s best interest. The view is mentioned by Dr. Zuhayli in Mu’atamad 2/34 and Dr. al-Qaradawi in Fiqh al-Zakah 1/263-64)

Others opt for gold. This view is also related by both Zuhayli and Qaradawi. The reason for this preference is in part based on the drastic changes in silver’s value over time. During the first Islamic century, the dinar was fixed at a ratio of 1:10 with the dirham. By the second half of the Umayyad period, its value has slid to a ratio of 1:12. Then, 1:15 and so on; eventually, in Fatimid times it was about 1:34. Therefore, it has not been stable like gold. Currently, one who possesses a nisab based on silver’s value is not wealthy.

If the nisab of other zakatable commodities is contrasted, then the difference is manifest. For example, zakah is due on 40 sheep. (Matn al-Tahrir 56) If we assume the market value of sheep to be $100 per head, then the value is about $4000. Also, zakah is due on one who possesses 720k of dates. (The figure is taken from Zuhayli’s Mu’atamad 2/57-60.) If the value is $5 per kilo, then the total for nisab is about $3600. The margin of difference between gold and many other zakatable commodities and silver is significant.

Zakah is intended to be taken from the rich and given to the poor. Bukhari and Muslim related that the Prophet (SAW) said,

فأعلمهم أن الله افترض عليهم صدقة توخذ من أغنيائهم فترد في فقرائهم

And Allah knows best.