How is the zakat on gold and silver in the form of jewelry and precious stones to be paid: by value or by weight? And what is the difference between the two?

Scholars have mentioned three categories for jewelry:

1. That which is considered by its weight for the nisab (threshold) and ikhraj (payment): This is forbidden jewelry, such as prohibited gold and silver vessels. Its nisab is determined by its weight as raw material, and the increase in value due to forbidden craftsmanship is not counted. However, the more correct view is that it should be considered by its value, similar to permissible jewelry, and the increase in value from forbidden craftsmanship should be deposited in the Bayt al-Mal (public treasury).

2. That which is considered by its value for the nisab and ikhraj: This refers to commodities intended for trade. If their value reaches the nisab of gold or silver, zakat becomes obligatory on them, even if their weight does not reach the nisab.

3. That which is considered by its weight for the nisab and by its value for ikhraj: This is permissible jewelry intended for personal use. If its weight reaches the nisab, zakat becomes obligatory based on its market value (at the value of manufactured gold or silver). If its weight does not reach the nisab, there is no zakat on it.

Ibn Qudamah clarified that the nisab for jewelry is determined by weight, unless it is for trade, in which case it is appraised. The disagreement among jurists revolves around whether to consider weight or value. Al-Shafi'i holds the view that both weight and value are considered, while Malik believes that only weight is considered. Some jurists, however, believe that zakat is related to both its weight and its form/quality.