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Islamic Refutation of Capitalist Economic System

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Economic Justice In Islam

Introduction

Two major economic systems have dominated the world arena in the last 100 years, namely Capitalism and Socialism. Socialism collapsed before the end of the 20th century with a complete failure, and hence will not be a subject in this discussion. Capitalism continues to dominate the entire globe, with different flavors and varieties implemented in different parts of the world. The dissatisfaction of people under socialism, and the accompanying pain and suffering have ended, but been replaced by yet another type of pain and sufferings.

After the collapse of Socialism, Capitalism entered an era of global economy, Globalization, thus impacting most of the people in the world. Therefore, this discussion explores the impact of capitalism on the world and the plight of people in poor and rich countries. On the other hand, it introduces an economic system that the world is yet to explore, understand, and implement. This system is based on Islam.

The Economic System

Economic system is a set of rules and regulations, which define how to distribute the wealth, how to possess it, and how to spend or dispose of it. This system (set of rules) is based upon a particular viewpoint in life, or ideology. Therefore, the economic system of Islam is different from that of Socialism/Communism and that of Capitalism, since each of these systems follows its own ideological viewpoint. For example, the rules of possession and ownership under Capitalism differ from the rules of possession under Socialism, and from those under Islam.

Economic science deals with the production, its improvement, invention and improvement of its means. Economic science, as is the case with other sciences, is universal to all nations and is not associated with a particular ideology. For example, the improvement of production is a technical issue, which is purely scientific, and does not depend on a particular ideological viewpoint.

In addition to the essential understanding of the difference between the economic system and economic science, it is critical to understand the factors of success for any system. The success or failure of an economic system is measured by the direct impact on the humans who live under it. Measures of such impact are the level of security provided and satisfaction of needs. Security and satisfaction of needs are further measured in terms of:

⚫ Food security
⚫ Health security
⚫ Educational security
⚫ Conviction and trust in the economic foundation

In the next section we will address Capitalism as the dominating economic system today, its truth, reality, applicability and consequences.

The Capitalist Economic System

Theoretical Foundation

Capitalism addresses the materialistic side of life; it addresses the human needs and the means of satisfying those needs. It is established on three principles:

1. Relative scarcity of goods in relation to needs.

2. The economic value of a product

3. Pricing role in production, cons consumption, and distribution.

Relative Scarcity:

Man has needs that require satisfaction. Capitalism views the human needs as purely materialistic, such as the need for food, clothing, medicine, education, and security. As for the moral needs such as pride and honor, or spiritual needs such as the sanctification of God’s will, they are not recognized economically, and are therefore disregarded and have no place in economic studies within the capitalist system.

The capitalist looks at the means of satisfaction, that is, the commodities and services, from the viewpoint that they satisfy a need, without taking any other factor into consideration. This system considers, for example, wine as an economically beneficial product because it satisfies the need of some, and perceives the wine maker as service provider. Because wine and wine providers satisfy a need it is considered as having an economic value. Since the need in the capitalist view means a desire, then anything desired, whether it is essential or not essential, beneficial or harmful, it is considered economically beneficial. Products may be considered beneficial from an economic viewpoint even if the public opinion considers them of no benefit, or even harmful. Thus wine, tobacco, drugs, guns, and apples are beneficial things since there are people who desire them. Stocks, interest based loans are also beneficial as long as there is someone who would benefit from their use.

As such, capitalism does not concern itself with the societal values other than materialistic ones. Therefore, the capitalist economic system’s primary function is to supply goods – commodities and services – that is, to provide the means of satisfying man’s needs, irrespective of any other consideration. Capitalism recognizes that man has basic needs, which must be satisfied, and wants which increase in number as man proceeds to a higher level of urbanization.

Relative scarcity foresees the economic problem as the relative shortages of commodities and services towards the unlimited and constantly growing human needs (wants). This basic principal of capitalist economic philosophy provides the basis for the definition of the economic problem under capitalism. In particular, the problem that capitalism attempts to resolve is the satisfaction of an ever growing human needs using insufficient resources and means of satisfaction. This is the essence of relative scarcity of products. An economic dilemma that cannot be resolved no matter how much commodities and services are produced, thus setting unrealistic goal to be achieved.

The inevitable consequence of relative scarcity is that the focal point of a capitalistic society is the increase production of products and services. However, the distribution of the products over the needs is fully dependents upon the individual ability to obtain it. It should be noted that in a capitalistic society the problem is to make the resources available so as to satisfy the needs in a society, but not necessarily the needs of every individual. It is not surprising therefore, that the main focus of the economy under capitalism is the increase in the national production emphasized by the Gross Domestic Products (GDP) and Gross National Products (GNP). Capitalism views economic growth, the increase in GDP and GNP, as the mean of solving the problem of poverty. There are serious flaws in these principals:

1. Correlation between the needs and the means of satisfaction

Under Capitalism, production and distribution are considered to be one major subject. Capitalism holds one view towards the economic science and the economic system without differentiating between them. However, there is a major difference between the economic system and economic science as previously defined. The integration between production of the economic material and the manner of its distribution, is a fundamental fault in the capitalist system which is bound to cause failure in the economy.

2. The human needs are not materialistic only

The reference to the needs, which require satisfaction as being purely materialistic, is wrong, and contradicts the natural reality of human needs. Human beings have moral, spiritual, and ethical needs that require satisfaction, which in turn require commodities or services for their satisfaction.

3. Commodities and services relation to the society

Man is viewed by capitalists as a purely materialistic creature, with no relevance to his spiritual needs, ethical thoughts, and moral objectives. Thus, Capitalism does not give weight to Societal values, except to the materialistic value of the product and its profitability. Cheating in the economic sense is valuable as long as it leads to profitability (Enron and Arthur Anderson). Monopoly is feasible economically, while it can be maintained and supported (Microsoft). Under Capitalism, feeding a poor (wealth distribution) may be done only if it brings a material benefit, such as tax break (non profit organizations). The Capitalist economy focuses on the satisfaction of needs and wants irrespective to the societal values and needs. Societal values and needs are protected as much as it does not limit the individual pursuit of satisfaction.

The exchange of resources and efforts among people creates relationships according to which the structure of the society is formed. Thus, viewing the economic commodity as a mean of fulfilling a need, without caring for the societal values, violates a fundamental rule of society structure. The effect on society should be perceived when considering the economic commodity. Therefore, it is incorrect to consider a thing as beneficial just because there is somebody who wants it, whether it affects the relationships among people or not, and whether it is prohibited or permitted in the belief of the people. Rather things should be considered beneficial if they are really beneficial in respect to what the society should be.

Therefore, it is incorrect to consider alcohol, cannabis, opium, explosives, guns, tobacco and the like as beneficial commodities and to consider them economic commodities just because there is somebody who wants them. Instead, the effect of these economic commodities on the relationships between people in society must be considered when considering the benefit of things i.e. when considering the goods as an economic commodity or not. It is a system fault to look at a product merely as it is, regardless of what the society should be.

4. Poverty of individuals is the main economic problem

Capitalism concentrates on production of wealth more than distribution of wealth. The importance of distribution of wealth to satisfy the needs has become a secondary issue. Therefore, the capitalist economic system main aim is to increase the country’s wealth as a whole, and it strives to achieve the highest possible level of production. The achievement of the highest possible level of satisfaction for the members of society is viewed as a result of increasing the national income, the gross national product. In the capitalist view this can be achieved by raising the level of production in the country, and by enabling individuals to acquire the wealth as they are left free to work and produce.

So the economy does not attempt to satisfy the needs of the individuals and to facilitate the satisfaction of every individual in the community, rather it is focused on raising the level of production and increasing the national income. Only then the distribution of wealth among the members of society occurs, by means of freedom of possession and freedom of work. So it is left to the individuals to acquire what they can of the wealth. Everyone strives to get his/her share of the wealth using whatever means, skills, or tools he/she can afford. Whether the individual is or is not able to satisfy his/her needs is not of concern to the economy, as long as the production of goods continues to grow, and the wealth continues to grow.

This is the major principal of the capitalist economy. It is inherently faulty, and contradicts reality and does not lead to an improvement in the level of livelihood for all individuals, and does not fulfill the basic needs of every individual. It does not resolve the issue of poverty for the individuals, despite the massive increase in the production of goods and services.

The hard fact in this reality is that the needs, which require satisfaction, are individual needs. They are needs of particular people such as George, Maria, Hessian, Muhammad, and the like. The fact that the needs of George, for example, are satisfied does not make Maria any better, unless her needs are also taken care of. So these are needs of individuals and not needs for a group of human beings, a group of nations, or a group of people. Therefore, the economic problem must focus on distributing the means of satisfaction for all the individuals of a society. In other words, the distribution of the funds and benefits must reach every member of the nation or people. It is not sufficient to increase the wealth of the group, irrespective of the plight of every individual.

Consequently, the study of the factors that affect the size of national production differs from the study for satisfying all the basic needs of all individuals personally and completely. The subject of study must be the basic human needs of man, as a human being, and the study of distributing the wealth to the members of society to guarantee the satisfaction of all their basic needs while allowing them to pursue the satisfaction of their wants & luxury needs. This should be the subject of study, and should be undertaken in the first place. Moreover, resolving the poverty of a country does not resolve the problem of poverty for individuals. On the contrary, resolving the poverty of the individuals, and the fair distribution of the wealth of the country, motivates all the people of the country to work towards increasing the national income and resolving poverty of the country. Yet, the study of factors that affect the size of production and the increase of the national income should be discussed within the framework of economic science, rather than in the discussion of the economic system.

5. Scarcity of resources is not the problem and human needs are limited

Capitalism views the economic problem, which faces any society to be the scarcity of commodities and services. It claims that the human needs are steadily increasing, and the products continue to be too scarce to satisfy the growing needs of the people. This view is erroneous and in fact contradicts with reality. This is because the needs, which must be met, are the basic needs of the individual as a human (food, shelter, education, health and clothing), and not the luxuries, although they too are sought. The basic needs of humans are limited, and the resources and products, which they call the commodities and services, are certainly sufficient to satisfy the basic human needs. It is possible to satisfy all of the basic needs of mankind completely.

The economic problem is, in reality, the distribution of these resources and services enabling every individual to satisfy all basic needs completely, and after that helping them to strive for attaining their luxuries. The basic needs of man as a human do not increase. Only the luxurious needs that may increase and vary due to higher urbanization.

Practical Implementation

The discussion of the capitalist economic system leads to the conclusion that the implementation of this system over a period of time should lead to a profound poverty and severe dissatisfaction for any society. In this section, we will examine actual data from the contemporary world that lives under the domination of capitalist economic systems. The data shows without any doubt that the theoretical errors of the major economic principals have led to serious failures that cause huge catastrophic effects on a very large number of the population in the world.

Hunger under capitalism

Growing out of a Harvard School of Public Health conference on hunger, The Physician Task Force on Hunger in America was established in early 1984. The major findings and
conclusions of the Task Force include:

⚫ Hunger is a problem of epidemic proportions across the nation
⚫ Hunger in America is getting worse, not better
⚫ Malnutrition and ill-health are associated with hunger
⚫ is the result of federal government policies
⚫ Present policies are not alleviating hunger in America

Conclusion: Resolution of hunger and poverty require fundamental change at the level of the economic system. Capitalism is designed to produce poverty not to resolve it.

Globalization is the newer form of global capitalism. It is capitalism across nations. Capital flows between nations without serious constraints. Products move from the producing origins to consuming destinations without the feel of borders or national
barriers. Again, the production of resources and wealth increase and multiply. But the impact of the tremendous growth of wealth does not find its way to satisfy the needs of the people. Consider this report on globalization:

“The Scorecard on Globalization 1980-2000: Twenty Years of Diminished Progress”

By Mark Weisbrot, Dean Baker, Egor Kraev and Judy Chen

For economic growth and almost all of the other indicators, the last 20 years have shown a very clear decline in progress as compared with the previous two decades. Among the findings:

Growth:

The fall in economic growth rates was most pronounced and across the board for all groups or countries. The poorest group went from a per capita GDP growth rate of 1.9 percent annually in 1960-80, to a decline of 0.5 percent per year (1980-2000). For the middle group (which includes mostly poor countries), there was a sharp decline from an annual per capita growth rate of 3.6 percent to just less than 1 percent. Over a 20 year period, this represents the difference between doubling income per person,versus increasing it by just 21 percent. The other groups also showed substantial declines in growth rates.

Life Expectancy:

Progress in life expectancy was also reduced for 4 out of the 5 groups of countries, with the exception of the highest group (life expectancy 69-76 years). The sharpest slowdown was in the second to worst group (life expectancy between 44-53 ears)..

Infant and Child Mortality:

Progress in reducing infant mortality was also considerably slower during the period of globalization (1980-1998) than over the previous two decades. The biggest declines in progress were for the middle to worst performing groups. Progress in reducing child mortality (under 5) was also slower for the middle to worst performing groups of countries.

Education and literacy:

Progress in education also slowed during the period of globalization. The rate of growth of primary, secondary, and tertiary (post-secondary) school enrollment was slower for most groups of countries.

Globalization and Inequality Among Nations

According to this “old fashioned – three worlds partition” partition, 76 percent of world population lives in poor countries, 8 lives in middle income countries (defined as countries with per capita income levels between Brazil and Italy), and 16 percent lives in rich countries. Now, if we keep the same income thresholds as implied in the previous division, and look at “true” distribution of people according to their income (regardless of where they live), we find a very similar result: 78 percent of the world population is poor, 11 percent belongs to the middle class, and 11 percent are rich.

Economic health or illness?

The most important index of economic well being under capitalism is the index that monitors the growth of the nation’s health as a whole. DOW Jones, NASDAQ, NIKO, NYSE and other indexes monitor the status of the nation’s most powerful companies. A steady increase of these indexes does not record, reflect or impact the status of the poor in the nation. In fact, the overwhelming data shows that poverty and hunger persist despite the steady increase of economic indexes over the years. The daily report of the economic indexes prove one more time that capitalism is inherently concerned about the growth of products, rather than the satisfaction of the needs of people.

Virtual Wealth

The obsession of product and wealth growth under capitalism has resulted in the removal of the boundaries between the products and services and money. The monetary system existed in the first place to represent the values of products and services in a mobile transferable format. For centuries, gold and silver provided a solid base for measuring the exchange value of products and services. Under the pressure of growing economic product growth, the US capitalist economists canceled Briton Woods treaty which establishes a fixed exchange rate for gold, thus making gold one more commodity. The devastating result of this action is the creation of a new environment where wealth has become virtual wealth. By virtual wealth, I mean the growth of money independent of the growth of products and services. The two major factors that lead to the unlimited growth of money are the interest (usury) and stock investments. Interest allows money to grow without the involvement of product and services. The values of stocks increase or decrease quite often based on circumstances, politics, stability, and other factors not directed to the products and services provided by the stock holding company. The phenomenon of DOT.COM in the 1990’s is a clear example.

Islamic Economic System

Before nudging in the discussion of the economic systems and their impacts on us as
people, I would like to lay down a foundation regarding Islam.

Islamic Sources

Islam is a religion in the sense that it is based on a belief in God (the creator) and in the accountability to God on the Day of Judgment. Islam is also an ideology in the sense that it comprises an ideological foundation and a system of laws for the individual and the society. The Islamic systems cover the political, economic, and social systems. Islam is founded upon the fundamental principal that man, life, and universe are all the creations of the eternal, one and only one God whose main name in Islam is Allah. Allah possesses many attributes, all of which are considered to be eternal and unbounded.

The belief in the existence of God, the Eternal Creator, is a rational process in Islam and an obligation upon the reasoning facility of the human. The belief in God under Islam requires also the belief in all His attributes and functions. Belief in God, as such, requires the belief that there needs to be a channel through which God communicates to the people the means and ways to worship. This channel is what is known as Prophethood and/or the Messenger. Worshipping Allah, under Islam, is the process of following the guidance revealed by God through His Messengers and/or Prophets. Islam considers the belief in the Prophethood an essential principal of Islam. The Prophets include Adam, Ibraheem, Isaac, Moses, Jesus, Muhammad (Peace Be Upon Them All) and many others. Islam, as a religion and ideology, is based entirely on what is revealed to Mohammad (Sallallahu alayhi Wasallam). The revelation to Muhammad (Sallallahu alayhi Wasallam) has two forms. One form is the Quran, which is the actual word of Allah the creator. The wording and the meanings of the verses are written into the Quran exactly as revealed to Muhammad (Sallallahu alayhi Wasallam). The Quran was compiled and completely written during the life of the Messenger Muhammad (Sallallahu alayhi Wasallam). The other format of the revelation is what is known in Arabic as the “Sunnah” of Muhammad (Sallallahu alayhi Wasallam). The Sunnah comprises statements, actions, and endorsement of Muhammad (Sallallahu alayhi Wasallam). The Sunnah is also a revelation from God to Muhammad (Sallallahu alayhi Wasallam), except that the wording of the Sunnah is left to Muhammad (Sallallahu alayhi Wasallam). The Sunnah was compiled and authenticated after the death of the Prophet (Sallallahu alayhi Wasallam) based on written statements and verbal narrations.

For a view to be considered an Islamic one, it has to be validated through the Qur’an and the Sunnah. In this lecture, I will trace the Islamic economic system through the verses of the Qur’an and the statements of the Sunnah.

The View of Islam towards the Economy

Allah created all resources in the world

In the Qur’an, Allah states that all the resources in the world are created by Him, and made usable to the humans:

“It is He who created for you all that exists on earth.” [Al-Baqarah: 29]

“Allah is He Who put at your disposal the sea so that the ships may sail by His command, and so as you may seek His bounty.” [Al-Jathiyah: 12]

“He put at your disposal that which is in the heavens and that which is in the earth, all from Him.” [Al-Jathiyah: 13]

“And We sent down iron, in which is great might, as well as many benefits for mankind.” [Al-Hadid: 25]

“Let man consider his food. How We pour water in showers. Then split the earth in fragments. And cause the grains to grow therein. And grapes and fresh vegetation. And olives and dates, and enclosed gardens, dense with lofty trees. And fruits and grazes. Provision for you and your cattle.” [Surah Abasa: 24-32]

These examples indicate that technical means of production is left to the people. It is apparent that Islam focuses on the economic system (distribution of wealth) and not economic science (technical production).

Economic Policy in Islam

The economic policy is the objective of the laws, which deal with the management of human basic needs (food, shelter, education, health, security). The Islamic economic policy could be understood from the statement of Prophet Muhammad (Sallallahu alayhi wasallam):

“Whom who wakes up secure at home with healthy body and food for his day as if he acquired the whole life”.

The Prophet (Sallallahu alayhi wasallam) also states:

“Allah breaks covenant with any group of people living in a close vicinity, whereby one of them goes to bed while hungry”.

The economic policy in Islam aims at securing the complete satisfaction of all basic needs for every individual, and to enable each individual to purse the satisfaction of their luxuries. Islam looks at every individual as a human being whose basic needs to be satisfied completely, then it looks to him in his capacity as a particular individual, to enable him to satisfy his luxuries as much as possible.

On the other hand, Islam views the individual as part of a whole society that lives according to certain rules and regulations that have to be taken into consideration.Therefore, the purpose of the economic policy in Islam does not address how to raise the standard of living in the country without securing the rights for every individual. Nor is it just to provide the means of satisfaction in the society without setting wealth distribution processes.

The Islamic economic objective is achieved through multiple laws and regulations:

First, defining property ownership as being of three kinds:

1. Individual ownership
2. Public ownership
3. State ownership

The individual can own anything except that of what is public property or prohibited materials such as alcohol or pigs. The public owns all minerals of the earth that are not limited by nature such as gold and silver mines, oil fields, natural gas fields, etc. or all things that are publicly shared such as seas, rivers, roads etc. The state owns certain revenues including land taxation called (Kharaj). Such laws allow for fair distribution of wealth and allow the state to provide public services, security, healthcare, education and others.

Second, Islam prohibits any kind of Usury and interest based loans, on the other hand it encourages partnership in different ways (but not Joint Stock Companies) and interest free loans. Also, Islam prohibits monopoly allowing for true competition and opportunity.

Third, Islam obliges each capable person to work, so as to achieve the basic needs for himself and his dependants.

Fourth, through the unique Islamic social structure based around protecting the family,Islam obliges adult males to support their parents once the father is not able to work or passed away. If there are no one in the family who can support then the State Treasury (Bait ul-Mal) has to step in. As such, Islam requires that the individual secure for himself and his dependants the satisfaction of the basic needs i.e. adequate food, clothing, education, medication and housing. Islam then encourages the individual to secure the luxuries of life as much as he can.

Fifth, Islam prevents the government from the imposition of taxes, except in cases of public disasters such as famine, and where the state funds are unable to cover expenses. Tax then is imposed for a limited time and taken only from the wealthy.
Through the combination of spiritual, social and economic drives, the Islamic economic system achieves the right of livelihood for everyone individually, and facilitates the securing of the luxuries.

To achieve the societal values within which the individual lives, Islam sets certain rules and regulation within which the individual is to behave while striving to secure his/her needs. For example, Islam prohibits the production and consumption of wine by Muslims, and it does not consider it an economic material. Islam prohibits the taking of riba (usury, interest, etc.) and its usage in transactions for everyone who holds Islamic citizenship. It does not consider riba as an economic commodity, whether for Muslims or non-Muslims. Islam considers what the society ought to be when utilizing any property.

Islam did not detach the individual from being human, nor the human being from being a particular individual. Furthermore, Islam does not consider what the society ought to be separate from the issue of securing the satisfaction of the basic needs for every individual, and enabling him/her to satisfy the luxuries. Rather, Islam makes the satisfaction of the needs and what the society ought to be, as two inseparable issues.For the sake of satisfying all the basic needs completely, and to enable satisfaction of the luxuries, the economic commodity should be available to people, and it will not be available to them unless they strive to earn it. Provided that there is a system that protects the basic integrity of the human being. Therefore, Islam urges people to earn,seek the provision and strive without the fear of not finding food to eat or secured home to return back to at the end of the day. Islam made striving to earn the provision compulsory upon Muslims thus creating a productive society.

Allah said:

“So walk in the paths of the earth and eat of His sustenance which He provides.”  [Al-Mulk: 15]

Many Ahadith came to encourage the earning of property. In one Hadith, the Prophet Muhammad _ shook the hand of Sa’ad ibn Muadh (ra) and found his hands to be rough. Sa?ad said: “I dig with the shovel to maintain my family.” The Prophet (sallallahu alayhi wasallam kissed Sa’ad’s hands and said: “(They are) two hands which Allah loves.”

The Prophet (sallallahu alayhi wasallam) said: “Nobody would ever eat food that is better than to eat of his own hands work.”

It was narrated that ‘Umar Ibn Al-Khattab (Radhiyallahu anhu) passed by some people who were consistently in the Mosque reading the Qur’an (meaning not working). He asked who they were. He was told: “They are those who depend upon Allah (Al-Mutawwakiloon).” ‘Umar replied: “No, they are the eaters who eat the people’s properties. Do you want me to describe those who really depend upon Allah (Al-Mutawwakiloon)? He is the person who throws the seeds in the earth and then depends on his Lord The Almighty,
The Exalted (Azza wa jall).”

Thus we find that the verses and the Ahadith encourage striving to seek provision, and working to earn property, just as they encourage the enjoyment of the property and eating of the good things.

Allah said:

“Say: who has forbidden the beautiful gifts of Allah, which He has provided for His servants, and the things, clean and pure, (that He has provided)?” [Al-A’raf: 32]

“O you who believe! Spend of the good things which you have earned, and of that which We bring forth from the earth for you.” [Al-Baqarah: 267]

“O you who believe! Do not prohibit the good things which Allah made halal for you.” [Al-Ma’idah: 87]

These verses, and the like, denote clearly that the divine rules (Ahkam Shari’ah) related to the economy, aim at acquiring property and enjoying good things. So, Islam obliged individuals to earn, and ordered them to enjoy wealth that they earned, so as to achieve economic growth in the country, to satisfy the basic needs of every person, and to enable the satisfaction of his luxuries.

However, the economic progress through motivating every capable individual to work, assigning properties to the State and the investing of public property, all are means to satisfy the needs in the best possible manner. The Messenger of Allah (sallallahu alayhi wasallam) said:

“Whosoever sought the life (matters) legitimately (halal) and decently he will meet Allah with his face as a full moon; and whosoever sought it arrogantly and excessively will meet Allah while He is angry at him.”

The Prophet also said: “Do you have, son of Adam, of your property except that which you ate and consumed, that which you wore and exhausted, and that which you donated and preserved (for yourself in the hearafter)?”

Allah the Supreme said:

“Don’t commit Israaf (spending or going beyond the limits imposed by Islam); surely He (Allah) does not like those who condone Israaf.” [Al-A’raf: 31]

Islam made the aim of owning properties a mean towards satisfying the needs and not for the purpose of boasting. It required managing the economy according to Allah’s orders and made it obligatory. It ordered the Muslims to seek the Hereafter and the pleasure of the creator through what they earn and spend by their own well, without ignoring the goods of this worldly life.

Allah said:

“But seek the abode of the Hereafter in that which Allah has given you, and do not neglect your portion of worldly life, and be kind as Allah has been kind to you, and seek not corruption in the earth.” [Al-Qasas: 77]

Islam secured the observance of the rules in two ways complementing each other. First,Islam motivated the Muslims to adhere to this economic policy through the fear of Allah (Taqwa). Second, Islam legislated laws which the State implements upon the people.

Allah said:

“O you who believe! observe your duty to Allah and give up what remains (due to you) from riba, if you are (in truth) believers.” [Al-Baqarah: 278]

Analysis of the divine rules related to the economy, shows that Islam addresses the
issue of enabling people to utilize wealth. Islam addresses the initial acquisition of wealth, its disposal and its distribution amongst the public. The rules that deal with the economy are thus based on three principles:

1. Initial ownership,
2. Disposal of the ownership, and
3. Distribution of wealth amongst the people.

With regard to the issue of ownership, it belongs to Allah, since He is the Owner of all the Dominion (Malik al-Mulk). Allah stated in the texts that property (Maal) belongs to Him.

Allah said: “And give them from the property of Allah, which He gave to you.” [An-Nur: 33]

Property, therefore, belongs to Allah alone. However, He has put mankind in charge of property, provided them with it, and has given them the right of owning it.
Allah, the Exalted said:

“And spend from what He put you in charge of.”  [Al-Hadid: 7]

“O you who believe! observe your duty to Allah and give up what remains (due)”

“And He has provided you with properties and offspring.”  [Nuh: 12]

Islam also defined three types of ownership (as mentioned earlier):

1. Individual ownership
2. State ownership
3. Public ownership

Through the management of these types of ownership, the economy of both the society and the individuals are completely satisfied.

Zakat and Poverty

Islam has waged a war on poverty by all means. It is the poverty of the individual people that Islam is concerned with, in addition to the poverty of the nation as a whole. Islam has instituted the charity, called in Islam the “Zakat” in a manner that eliminates the poverty altogether. “Zakat” in Islam is a mean of worship. It is one of the pillars of Islam as much as the prayer is. The Islamic system aims at eliminating poverty from the society, rather than managing the poor. One of the companions of the Prophet Mohammad (sallallahu alayhi wasallam) and also one of the Guided Successors of Him, Ali Bin Abi Talib (radhiyallahu anhu) stated:

“If poverty were a man, I would certainly kill him”.

Practically, after few years of implementing Islam in the Islamic society, the notion of poverty was gone altogether. It is narrated in  history that during the era of the Khalifah ‘Umar Bin Abd al-Aziz, there was no single poor person within the Islamic  State who would accept the charity of the “Zakat”.

In a statement by Prophet Mohammad (sallallahu alayhi wasallam), he says:

“Allah breaks covenant with any group of people living in a close vicinity, whereby one of them goes to bed while hungry”.

The Islamic economic system defines the main problem to be solved by the system as the poverty of the individuals. The economic index, thus in the Islamic State, would be the percentage of people who live below poverty line. The economic strength and growth will be measured by the actual well-being of the individuals rather than by the well-being of NASDAQ or DOW JONES. What good would it do to the stomach of a poor person, if the NASDAQ gains or loses points? The Islamic Economic Index is based on the food that is available to each and every human soul in the society.

The Islamic economic system reserves the vital resources of the state for the well-being of the people. One or more companies under Islam for example, will not own the oil fields.The fact that a certain company was able to drill and exploit oil fields in Texas does not give it the right for the oil. The oil exists in fields that go beneath the houses and lands of millions of people. In Islam, the oil belongs to all the people in the state. This is not to be mistaking with socialism that dictates that all means of productions belong to the people. Thus, the Islamic system ensures that the vital resources that belong to the people be actually returned to the people. As such, poverty will never exist in any society that has vital resources.

Usury – Interest – Riba

Islam categorically prohibited the use of money to grow money, i.e., usury. Loans in Islam are given to others and considered a mean of worship. Allah declares that whoever gives a loan (no interest) to another person is indeed giving a loan to Allah. In return, Allah multiplies the reward for the loan giver.

Allah stated:

“Whoever gives a good loan to Allah; and Allah will multiply it to him many folds”

Islamic Economy: Reality

The harsh reality is that Islam as described in the Qur’an and Sunnah has been removed from the real life of the people (Muslims and non-Muslims alike) for almost a century. The Islamic State has been the responsible entity for implementing the Islamic systems during and after the death of the Messenger Mohammad (Sallallahu alayhi wasallam). The Islamic Nation continued to function (with ups and downs) until 1924, when Mustafa Kemal of Turkey with the help of western European capitalists managed to abolish the Ottoman Islamic state (Khilafah). Since then, the Muslims and non-Muslims in the entire world have been living under various secular systems, implementing capitalism in the economic life.

Muslims continued to believe in Islam and practice those parts of Islam that pertain to the individual. However, for Islam to produce the results and objectives set forth in the Qur’an and the Sunnah, the full implementation of Islam is necessary. Without full implementation of Islam, the results could be counter productive. As a result of the absence of Islam, the Muslims resorted to national bonds, ethnic traditions and values. Quite often and after decades of intentional misguiding, the Muslims mix their national values, national aspirations, and methods with those of Islam. The truth of the matter though is that Islam was revealed as a set of laws, regulations and systems to guide and manage the behavior of the society as well as the individuals.

The history of the life of Mohammad (sallallahu alayhi wasallam) shows that the objectives of Islam, the resolutions of Islam, and the values of Islam started to materialize only after the establishment of the Islamic State in Medinah, 13 years after the beginning of Islam. In fact, most of the laws, regulations, and systems were not revealed to Muhammad (sallallahu alayhi wasallam) except after his migration to Medinah where the state was established. The laws of the Zakat, riba (usury), ownership, and wealth distribution were revealed after the state was created.

Conclusions

Islam as a religion and ideology needs to be revisited by both Muslims and non-Muslims alike. It is a religion that should be looked at as a continuation of previous religions and inheritor of them as well. As an ideology, Islam should be viewed as one that provides economic, political, and social systems that do not belong to the ideologies of materialism (both capitalism and socialism). After the fall and collapse of socialism, the people of the world resorted to capitalism as their only alternative. The collapse of capitalism is eminent as a natural consequence to its inability to address the human needs in a satisfactory manner. It is the responsibility and the duty of the people of the world to examine Islam with serious and sincere scrutiny, in order to consider it as the only viable alternative to capitalism.

Zakaat – A Perpetual Investment

Every person’s heart’s desire is to earn an everlasting fortune -a fortune that never diminishes nor depletes at any time. Instead, its profits and returns continue to grow every second. How can such a fortune be acquired? The answer to this vital question is: invest in a perpetual investment -the investment ofthe Aakhirah (Hereafter). This investment is the ideal investment which never diminishes at anytime. It perpetually goes on growing till eternity. No loss. Only profit and growth. The only condition is sincerity. Any person who has a rand to spare should invest in such an investment. Every cent given in charity is invested in the investment of the Aakhirah. Such money is in reality saved. What is not invested in the Aakhirah is either spent or left behind for others.

While the immense rewards for spending in the path ofAllah Ta’ala are attained for even optional charity, the greatest rewards are for fulfilling the Fardh (compulsory) duties. Thus the greatest rewards would be for discharging one’s zakaat correctly, together with inculcating the true spirit offulfilling this great ibaadah. There are many verses ofthe Qur’an as well as Ahaadith of Rasulullah (Sallallahu Alayhi Wasallam) which explain the great rewards promised for discharging one’s zakaat.

Hazrat Hasan (Radhiyallahu Anhu) reports that Rasulullah (Sallallahu Alayhi Wasallam) said: “Protect your wealth by discharging zakaat, treat your sick by discharging sadaqah and combat the waves ofcalamities by resorting to dua and humility.” (Majma’uz Zawaaid #4336)

Important Aspects to be Borne in Mind when Discharging Zakaat

Zakaat must be given with complete sincerity to fulfil the command of Allah Ta’ala and earn His pleasure.

Zakaat must be given happily and wholeheartedly. It should not be regarded as a burden.

If zakaat is given in kind (stock, etc.), then at least something of average quality should be given. It is against the spirit of discharging zakaat to give something which cannot sell or is of inferior quality.

Zakaat must be discharged on the basis of proper calculation. Enquire from the Ulama to ensure that you have not underpaid.

Zakaat should be given to those who are eligible to receive it, otherwise the obligation will not be fulfilled.

Zakaat is payable upon the expiry of one lunar year from the time one became the owner of nisaab (the minimum amount of wealth upon which zakaat is compulsory).

When discharging the zakaat, one should ensure that the zakaat is given from pure Halaal earnings.

One should not discharge the zakaat for show nor publicize the amount of zakaat one has discharged. Doing actions for show and ostentation destroys the rewards of zakaat.

One should not cause any pain to the recipients of zakaat, nor express his favour upon him.

Serious Consequences for Neglecting the Obligation of Zakaat

By discharging one’s zakaat with care and with the true spirit of zakaat, one will receive immense rewards in the Hereafter and one’s wealth will be protected in this world. On the contrary, by not discharging the zakaat one becomes sinful and deserving ofpunishment in the Hereafter. Severe warnings and admonishments have been sounded in the mubaarak Ahaadith for the one who neglects the obligation of zakaat.

Hadhrat Abu Hurayrah (Radhiyallahu Anhu) reports that Rasulullah (Sallallahu Alayhi Wasallam) said: He who, despite being given wealth by Allah Ta’ala, does not discharge his zakaat, his wealth will be made into a poisonous, bald-headed snake with two black spots over the eyes. It will coil itself around his neck on the Day of Qiyamah and then bite his cheeks and say, ‘I am your wealth, I am your treasure!’ (Bukhari #1403)

Hadhrat Abdullah bin Amr (Radhiyallahu Anhu) reports that once Rasulullah (Sallallahu Alayhi Wasallam), upon seeing gold bracelets on the wrists of two women, enquired from them as to whether they had discharged its zakaat? They replied in the negative. Rasulullah (Sallallahu Alayhi Wasallam) said, ‘Do you wish that in place of these gold bracelets you be made to wear bracelets of fire?’ They replied, ‘No.’ Rasulullah (Sallallahu Alayhi Wasallam) then said, ‘Then hasten in discharging their zakaat.’ (Tirmidhi #637)

Zakaat Masaail

Upon whom is Zakaat Waajib?

Q: Upon whom is zakaat waajib? A: Zakaat is waajib upon every Muslim, baaligh, sane, free person who possesses the nisaab amount for an entire lunar year. (Shaami 2/258)

Q: Is zakaat waajib on a person who possesses the nisaab amount but also has unsettled debts?
A: The principle of shari’ah is that after evaluating one’s zakaatable assets one will deduct all liabilities and debts. If the remaining amount reaches the nisaab, zakaat will be waajib. (Shaami 2/260, Fataawaa Mahmoodiyyah 14/36)

When will Zakaat be Obligatory?

Q: When will zakaat be obligatory?
A: The first day a person acquires wealth which equals the nisaab and the wealth remains with him for an entire lunar year, zakaat will be waajib on that wealth.

E.g. Zaid acquired R3, 000 (which is the nisaab amount) on the first day ofthe lunar year (1st of Muharram 1434). This wealth remained with him for an entire lunar year. On the 1st of Muharram 1435 zakaat will be waajib upon the wealth. It should be noted that if the amount decreased during the course ofthe year e.g. R3,000 decreased to R1, 000 but at the end of the zakaat year (1st of Muharram 1435) the amount returned to R3, 000 or more, zakaat will be waajib. However, if during the year all the money was spent, then despite the full amount (R3, 000) being possessed at the end of the lunar year, zakaat will not be waajib. Instead one year will be calculated from the date that he once again acquired the nisaab amount. (Shaami 2/302)

Increase or Decrease before the Zakaat Date

Q: What is the shar’ee ruling regarding a person who received some wealth prior to the completion ofthe zakaat year? E.g. Zaid’s zakaat year ends on the 1st of Ramadhaan. Afew days before the 1st ofRamadhaan he received a lump sum ofR1, 000, 000 in inheritance. Will Zaid have to pay zakaat on the R1, 000, 000 as well?
A: Zaid will have to include the R1, 000, 000 in his zakaatable assets. (Shaami 2/288)

Q: What is the mas’alah (ruling) regarding a person whose wealth decreased before the zakaat date? E.g. Bakr possessed R1, 000, 000 throughout the year. Just before the end of his zakaat year i.e. 1st of Ramadhaan, he suffered a loss of R900, 000 in his business. Will Bakr now have to pay zakaat on R1, 000,000 or R100, 000?
A: Bakr will have to pay zakaat on R100, 000. (Shaami 2/267)

Zakaatable Assets

Q: Upon which wealth does a person have to pay zakaat?
A: Zakaat will be paid on the following:

Cash (including cash in the bank)
The market value of the merchandise contained in the share of the company
Face value of the financial papers like bonds loaned to the government, etc.
The market rate of the balance of stock in trade (including raw materials)
Receivable amounts i.e. debts owed to a person, monies loaned to people, etc.
Foreign currencies
Gold and silver (Shaami 2/273, 288, 295, 305)

Q: Is zakaat waajib on properties, flats, etc?
A: Zakaat is not waajib on properties, etc. which are not purchased with the intention of resale. One will pay zakaat on the rentals received. However, ifthe properties were purchased with the intention of resale, then zakaat will be waajib on the market value of the properties. (Shaami 2/265, 2/267)

Zakaat on Gold and Silver

Q: What is the nisaab amount of gold and silver?
A: If a person possesses gold to the weight of 87,479g or silver to the weight of 612,35g, then zakaat will be waajib. (Shaami 2/295)

Q: How will zakaat be paid on gold and silver?
A: If a person possesses the amount of gold or silver which equals the nisaab i.e. 87,479g of gold or 612,35g of silver, then zakaat is waajib on him. If he discharges his zakaat from the actual gold and silver, then one fortieth of the gold or silver will be obligatory on him. However, if he discharges his zakaat in value i.e. rands/dollars or any other currency, then two and a half percent of its entire value (market rated value) will be compulsory upon him. (Shaami 2/297)

Zakaat on Stock in Trade

Q: Is zakaat waajib on goods?
A: Zakaat is waajib upon those goods which are purchased with the intention of resale and an entire lunar year passes upon it. (Shaami 2/267)

Q: Zaid purchased a consignment of goods from Pakistan with the intention ofresale. The goods were thereafter shipped to South Africa. The shipment has not yet reached the port of South Africa and Zaid’s zakaat year ended. Will Zaid have to pay zakaat upon these goods which he has not as yet taken possession of?
A: Since Zaid purchased the goods before his zakaat year could end, he will have to include these goods under his zakaatable assets i.e. stock in trade. However, he will only be obligated to discharge the zakaat of these goods once it reaches him. (Shaami 2/263)

Q: Is zakaat waajib upon the medication which the doctor administers to his patients or dispenses to them?
A: Since the medication is purchased with the intention of resale, zakaat is waajib upon it. (Shaami 2/267)

Q: If a person purchases raw materials with the intention of manufacturing products to be sold, then will zakaat be waajib on such raw materials?
A: Since the raw material was purchased with the intention ofmanufacturing products to be sold, zakaat will be waajib upon it. (Shaami 2/267)

Q: Does one pay zakaat on the cost price of trading stock or on the selling price ofthe trading stock? E.g. I sell cars. I paid R10,000 for the car but I am selling the car for R25,000. The book value ofthe car is R20,000. Do I pay Zakaat on R10,000, R20,000 or R25,000?
A: One will pay zakaat on the market value of the stock of trade. Market value refers to the price that the consumer (i.e. the public) generally pays to obtain the item regardless of whether one purchased it for a higher price or lower price and regardless of whether one is selling it for a higher price or lower price. This law applies to all mechandise. (Fataawa Mahmoodiyah 14/130)

Q: Is zakaat waajib on redundant stock?
A: If redundant stock refers to that stock which one is unable to sell quickly but is kept with the intention ofresale, then zakaat is waajib on such goods. However, if redundant stock refers to that stock which one no longer intends to sell, then this wealth no longer remains stock oftrade. Hence, zakaat will not be compulsory upon it. (Shaami 2/272)

Q: A person purchased an item for resale purposes but thereafter cancelled his intention. After some time, he decided to once again sell the item. Will zakaat be waajib on the item?
A: Zakaat will not be waajib upon the item. However, zakaat will be waajib upon the money received after selling the item. (Shaami 2/272)

Zakaat on Debts Owed to a Person
Q: Is zakaat payable on outstanding debts owed to a person in lieu of merchandise sold? If the debt is paid after few years, will zakaat have to be paid for the previous years?
A: Zakaat is waajib upon debts owed in lieu of merchandise sold. Ifthe debt is paid after few years, the zakaat will have to be discharged for the previous years. (Shaami 2/305)

Q: Is zakaat payable on outstanding debts owed to a person in lieu of services carried out e.g. accountants fees, lawyers fees, etc? If the debt is paid after few years, will zakaat have to be paid for the previous years?
A: If the outstanding debts are in lieu of some services carried out, then zakaat is not payable until one receives it even though the debt is paid after few years. (Shaami 2/305)

Q: Is zakaat waajib on rent owed to a person? In the case where the rent was received after few years, will zakaat be waajib on the rent for the previous years?
A: Zakaat is waajib upon the rent once it is received. Zakaat is not waajib for the past years. (Shaami 2/305)

Q: If the creditor waived off the debt, will zakaat be compulsory upon him for the previous years? A: If the credit or waived off the debt of a poor person, then since the wealth reached a recipient of zakaat, zakaat will not be waajib upon the debt, neither for the current year nor for the previous years. However, if the creditor waives off the debt of a wealthy person, zakaat will not be waajib for the current year, but zakaat will be waajib for the previous years. (Shaami 2/307)

Q: What is the shar’ee ruling regarding a debt that is owed to a person who has no hope ofreceiving the money?
A: If the debtor blankly denies owing the creditor and there is no way to retrieve the money, then zakaat will not be waajib upon the debt. However, ifthe debtor is unable to pay the debt due to financial constraints and wishes respite, then zakaat will be waajib on the debt. (Shaami 2/266)

The Recipients of Zakaat

Q: Which people are not eligible for zakaat?
A: The following people are not eligible for zakaat:

A non-Muslim
A Sayyid (descendent of Nabi Alaihis salaam’s family the Banu Haashim) even if he is poor. (The Banu Haashim include the descendents of either Hazrat Abbaas, Hazrat Ali, Hazrat Jafar, Hazrat Aqeel or Hazrat Haarith bin Abdil Muttalib (Radiyallahu Anhum))
The donors ascendants e.g. his parents, grandparents, etc. and descendents e.g. children, grandchildren, etc.
The donors spouse (husband or wife)
A minor whose father is wealthy A wealthy person (A person who possesses that amount of wealth which equals the nisaab after deducting all his liabilities and debts.) (Shaami 2/344-350)

Q: Will zakaat be discharged by giving it to a poor child?
A: Ifthe child’s father is wealthy then the zakaat will not be discharged by giving it to him. However, if the child’s father is poor or the child is an orphan then through giving him the zakaat money, the zakaat will be discharged on condition that the child has reached the age of understanding. (Shaami 2/344-350 ; Aalamgiri 1/190)

Q: A person gave zakaat to a muslim whom he regarded to be eligible for zakaat. However, after giving him the zakaat he discovered that he was not eligible for zakaat. Is the zakaat discharged?
A: If a person discharged the zakaat to a muslim regarding whom he felt was eligible for zakaat, then the zakaat will be discharged. (Shaami 2/352)

Zakaat on Previous Years

Q: What is the Shar’ee ruling regarding a person who did not discharge the zakaat ofhis jewellery, wealth and stock in trade for many years? How should he discharge the zakaat of the previous years?

A: It is compulsory upon one to discharge the zakaat during the year the zakaat became compulsory. If one delays in discharging the zakaat until the following years zakaat became compulsory, one will be sinful. The law pertaining to zakaat of the missed years is that one will evaluate his zakaatable assets and discharge 2 ½ % of the total for each missed year.

E.g. A persons zakaatable assets are evaluated at R100 000. He will discharge 2 ½ % of R100 000 (R2 500) for the first year. He will be left with R97 500. Thereafter he will discharge 2 ½ % of R97 500 (R2 437,50) for the second year. He will be left with R95 062, 50. He will discharge 2 ½% of that amount for the third year. In this manner he will discharge the zakaat of the remainder years. This is in the case where one did not spend the wealth.

In the case where the person spent the wealth or sold the stock in trade and he is unable to ascertain the exact amount ofwealth he possessed for each year of the ten missed years, then he will apply his mind to the best of his ability in trying to work out the amount which he possessed for each year and accordingly pay 2 ½ % of that amount for the respective years. (Fataawa Mahmoodiyah 14/153)

Conditions for the Validity of Zakaat

Q: Is it permissible to use zakaat funds to purchase hampers and feed the poor? Similarly, is it permissible to provide iftaar for the poor in the month of Ramadhaan using zakaat funds?
A: It will be permissible to use zakaat funds to feed the poor provided the requirement of tamleek is found. Tamleek means to transfer ownership ofthe wealth to someone who is eligible for zakaat. Therefore if the poor were given the zakaat hampers, the zakaat will be discharged. If the poor were not given the zakaat hampers but were merely invited for a meal and were allowed to partake of it, then zakaat will not be discharged since the requirement of tamleek was not found. Similar is the case regarding the iftaar food in the month of Ramadhaan. If the poor were given an iftaar hamper, the zakaat will be discharged. If the poor were not given the zakaat hampers but were merely invited to partake of the food provided, then the zakaat will not be discharged since the requirement of tamleek was not found. (Shaami 2/344)

Q: Will zakaat be fulfilled ifit is used to purchase an item for a school?
A: The zakaat will not be fulfilled unless a poor student is made the owner of the item. (Shaami 2/344)

Q: Is it permissible to build Masaajid with zakaat funds?
A: In order for ones zakaat to be discharged, the basic requirement oftamleek is necessary i.e. to transfer ownership to someone who is eligible for zakaat. Since this requirement is not fulfilled in the case ofthe Musjid, zakaat will not be discharged. (Shaami 2/344)

Q: Will zakaat be discharged by paying a poor person’s light or water account?
A: The fundamental requirement in the discharging of zakaat is the aspect of Tamleek i.e. to transfer ownership of the wealth to the recipient of zakaat. Since this requirement is not fulfilled in the case where the person paid the water or light account, the zakaat will not be discharged. However, if one fears that if he gives the money to the poor man, then instead ofhim paying his water or light account he will misuse the wealth, then in this situation he may ask the poor man for permission to pay the account on his behalf. In this way the zakaat will be discharged. (Shaami 2/344)

Zakaat on Shares

Q: Is zakaat waajib on shares? If yes, then how will it be calculated?
A: Zakaat is Waajib on shares. However, it should be noted that zakaat is not Waajib on the entire share. Rather zakaat is only Waajib upon the zakaatable assets ofthe company (i.e. the market value ofthe merchandise contained in the share ofthe company). As far as the non-zakaatable assets ofthe company are concerned e.g. fixtures, fittings, transport vehicles, etc. which are not part of the merchandise ofthe company, the value of all these things will be evaluated in the share and will not be taken in account when discharging the zakaat. If it is difficult to differentiate between the zakaatable and non-zakaatable assets of the company, then as a precaurionary measure one should discharge the zakaat on the market value ofthe entire share.

If a person purchased shares in a company that hires out vehicles, e.g. a trucking company or leases out properties, estates, flats, etc., zakaat will not be Waajib on this type of share. Instead, zakaat will only be Waajib on the profits accrued from the share. (Shaami 2/265, 2/267)

Miscellaneous Masaail

Q: Is zakaat waajib upon platinum, gems, rubies, diamonds, sapphires, etc?
A: Zakaat is not waajib on all precious stones besides gold and silver unless they were purchased with the intention of resale. (Shaami 2/273)

Q: A person purchased a car or house with the intention of resale. Since he does not have any other mode oftransport or residence, he is using the purchased car or house till he finds a buyer. Will zakaat be waajib upon the house and car?
A: In principle zakaat is waajib upon those things which are purchased with the intention of resale. However, in the above mentioned situation, since the person does not have any other mode oftransport or residence, zakaat will not be waajib on the house and car. This law will apply to all those things which relate to the hawaaij-e-asliyyah ofinsaan (the basic needs of man without which living becomes difficult). (Shaami 2/282)

Q: Is zakaat waajib on the payout received from a provident-fund, pension-fund or retirement-fund? A: If the employee willfully invests his money in the fund or commanded the company to invest it on his behalf or consented to the investment, then in all these situations zakaat will be waajib on the payout received. Zakaat will be waajib for the current year as well as the previous years. However, if the employer deducted a certain percentage ofthe employee’s salary without his consent, then zakaat will not be waajib on the payout received for the previous years. (Shaami 5/59)

Q: Is zakaat waajib upon life insurance which matures after the death ofthe policy holder?
A: Zakaat is not waajib upon wealth received from the insurance company after the demise of the policy holder since the wealth did not form part of his estate at the time of his demise. However, if the wealth was received during his lifetime, then he is obligated to pay zakaat ofthe current year as well as the previous years. (Shaami 5/59)

Q: Is zakaat waajib on the payout received from an insurance company for the previous years?
A: Zakaat is waajib on the payout received from the insurance company for the previous years. However, it should be known that it is only permissible for one to take back the amount he had given to the insurance company. The extra amount is impermissible and must be given in Sadaqah without the intention ofreceiving reward. (Shaami 5/59)

Note: It is impermissible for a believer to involve himself in any insurance policy as the elements ofgambling and interest are found in it. If a person has taken out an insurance policy of any kind, then he should sincerely repent and cancel the contract.

Ahadith On [Giving] Zakat on Jewellery

Aḥādīth On [giving] Zakāt on Jewellery[1]

By al-Ḥāfiẓ Jamāl ‘l-Dīn ’Abdullāh b. Yūsuf al-Zayla’ī [d. 762 AH]  الله همحر 

Translated by Abū Ḥumayd 

Translator’s Preface:

The following short piece translated from Ḥāfiẓ Zayla’ī’s book, Naṣb ‘l-Rāyah fī Takhrīj Aḥādīth ‘l-Hidāyah (see footnote 1), covers the issue of giving Zakāt on Jewellery, more importantly on gold and silver. It serves as a response to a group of people who have weakened this opinion and paid no attention to scholarly discourses upon it. It will also, Insha’Allah, serve as a reminder to instil the importance of giving Zakāt on gold and silver to the Muslims.

Translation:

Regarding this issue [of giving Zakāt on Jewellery], there are general narrations and specific narrations.  

Of the general narrations; the narration of Abū Sa’īd al-Khudrī (may Allāh be pleased with him), “…Sadaqah (Zakāt) is payable on less than five Awāq (of silver).” Al-Bukhārī[2] and Muslim narrated it in their Ṣaḥīḥayn (two authenticated collections), whereas Muslim[3] narrated it from Jābir with similar wordings. The narration of ’Alī: “…you must pay a Dirham [of Zakāt] for every forty (Dirhams).” Then the authors of the four Sunan have narrated it.[4] Ibn Qutaybah said: “Al-Raqqah is silver, whether they are Dirhams or other than it,” Ibn ‘l-Jawzī has narrated this in his ‘Taḥqīq’.[5] In the letter of ‘Amr b. Ḥazm: “…and in every five Ūqiyyahs of silver you give five Dirhams, and in every forty Dīnār you pay one Dīnār,” al-Nasā’ī, Ibn Ḥibbān and al-Ḥākim narrated it,[6] and the other aforementioned narrations all of which have passed. 

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As for the specific narrations, then from them is the narration related by Abū Dāwūd and al-Nasā’ī[7] from Khālid b. ‘l-Ḥārith from Ḥusayn al-Mu’allim, from ’Amr b. Shu’ayb from his father from his grandfather:  “A woman came to the Prophet ﷺ, who was accompanied by her daughter who wore two heavy gold bangles in her hands. He said to her: ‘Do you pay Zakāt on them?’ She said: ‘No.’ He then said: ‘Are you pleased that Allāh may put two bangles of fire on your hands on the day of judgement?’ Thereupon she took them off and placed them before the Prophet ﷺ saying: ‘They are for Allāh and His Rasūl’.’ 

Ibn ‘l-Qaṭṭān said in his book: “Its chain is authentic,” al-Mundhirī said in his abridgment: “The chain has no problems in it, indeed Abū Dāwūd narrated it from Abū Kāmil al-Jaḥdarī and Ḥumayd b. Mas’adah, and they are both from the authentic narrators (Thiqāt), both of whom Imām Muslim has utilised. [Then there is] Khālid b. ‘l-Ḥārith who is a Imām and Jurist, al-Bukhārī and Muslim both have utilised him. Similarly, Ḥusayn b. Dhakwān al-Mu’allim was utilised in the ‘Ṣaḥīḥ’. Ibn ‘l-Madīnī, Ibn Ma’īn and Abū Ḥātim did his (Ḥusayn) Tawthīq (authentication). [As for] ’Amr b. Shu’ayb then he is known. So, this chain stands as evidence God-willing.”[8]

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Al-Nasā’ī also narrated from al-Mu’tamir b. Sulaymān from Ḥusayn al-Mu’allim from ’Amr that he said: “A woman came…” and he (Mu’tamir) mentioned it in Mursal form. Al-Nasā’ī said: ‘Khālid is more established according to us than Mu’tamir. The narration of Mu’tamir is preferred according to the correct opinion.”[9]

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Another route is narrated by al-Tirmidhī from by Ibn Lahī’ah from ’Amr b. Shu’ayb from his father from his grandfather, he said: “Two women came to the Messenger of Allāh ﷺ and in their hands, were bracelets made of gold, so he ﷺ said to them: ‘Has Zakāt been given for that?’ They replied: ‘No.’ So he ﷺ said: ‘Do you like that Allāh places two bracelets of fire on your hands?’ They said: ‘No.’ So he ﷺ said: ‘Then give it’s Zakāt’”. 

Al-Tirmidhī said: “…and al-Muthannā b. ‘l-Ṣabbāḥ narrated it from ’Amr b. Shu’ayb similarly, Ibn Lahī’ah and al-Muthannā b. ‘l-Ṣabbāḥ have been weakened in Hadīth. Hence there is nothing authentic in regarding this chapter from the Prophet ﷺ.”[10] Al-Mundhirī mentioned: “Maybe al-Tirmidhī intended to mean the two routes which he mentioned (are weak), except the route of Abū Dawūd has no problems in it (the chain).”[11]  

Ibn ‘l-Qaṭṭān said after his authenticating of the narration of Abū Dāwūd: “Indeed al-Tirmidhī only weakened this narration because according to him there were two weak narrators; Ibn Lahī’ah and al-Muthannā b. ‘l-Ṣabbāḥ.”[12]

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Those that narrated it with the same chain as al-Tirmidhī are Aḥmad, Ibn Abī Shaybah and Isḥāq b. Rahwayh in their Musnads. And their wording is: “He ﷺ said to them; ‘So give Zakāt on that which is on your hands,’ and this wording removes the possibility of the interpretation of those who have said that the Zakāt mentioned in the narration is only legislated for what is beyond the necessity, and Allāh knows best. 

Another route narrated by Aḥmad (May Allāh be pleased with him) in his Musnad,[13] is from al-Muthannā b. ‘l-Ṣabbāḥ from ’Amr b. Shu’ayb etc., which is the route indicated to by al-Tirmidhī [as mentioned earlier], another route also narrated by Aḥmad and by al-Dāraqūṭnī in his Sunan from al-Ḥajjāj b. Arṭāh etc although al-Ḥajjāj is not utilised as proof.

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Another ḥadīth narrated by Abū Dāwūd in his Sunan[14] [with his chain]: Muḥammad b. Idrīs al-Rāzī related to us, who said: ’Amr b. ‘l-Rabī’ b. Ṭāriq related to us, who said: Yaḥyā b. Ayyūb related to us, from ’Ubaydullāh b. Abī Ja’far that Muḥammad b. ’Amr b. ’Aṭā’ informed him that ’Abdullāh b. Shaddād b. ‘l-Hād who said: “We entered upon ’Ā’ishah, [the wife of the Prophet ﷺ]. She said; ‘The Messenger of Allāh ﷺ entered upon me and saw two silver rings in my hand. He asked’: ‘What is this ’Ā’ishah?’ ‘I said: I had them made to adorn myself for you, Messenger of Allāh ﷺ.’ ‘He asked: Do you pay zakat on them?’ ‘I said: No. He said’: ‘This is sufficient to take you to the Hell fire.’”  

And al-Ḥākim narrated it with his chain in al-Mustadrak through Muḥammad b. ’Amr b. ’Aṭā’, and said: “Authentic upon the conditions of the two Shaykhs, and they did not narrate it.”[15] Al-Daraqūṭnī also narrated in his Sunan through Muḥammad b. ’Aṭā’ through the lineage of his grandfather and not his father. Thereafter he (al-Daraqūṭn) said: “Muḥammad b. ’Aṭā’ is unknown (majhūl).”  

Imām al-Bayhaqī said in al-Ma’rifah: “…and he is Muḥammad b. ’Amr b. ’Aṭā’, because his lineage went to his grandfather as al-Daraqūṭnī thought that he is unknown, whereas this not the case.”[16]

References

[1] From the author’s book; Naṣb ‘l-Rāyah fī Takhrīj Aḥādīth ‘l-Hidāyah [2/439-441, Dār ‘l-Ḥadīth; 1995 ed.]. The translator also took the title of translation from this author’s text.

[2] Ṣaḥīḥ ‘l-Bukhārī [#1413].

[3] Ṣaḥīḥ Muslim [#1635].

[4] Jāmi’ ‘l-Tirmidhī [#563], Sunan Abū Dāwūd [#1437], Sunan ‘l-Nasā’ī [#2442], Sunan Ibn Mājah [#1780].

[5] Gharīb ‘l-Ḥadīth, Ibn ‘l-Jawzī [1/411] 

[6] Ṣaḥīḥ Ibn Ḥibbān [14/501 #6559], Mustadrak ’alā ‘l-Ṣaḥīḥayn, al-Ḥākim [#1377].

[7] Sunan Abū Dāwūd [#1563], Sunan ‘l-Nasā’ī [#2479].

[8] ’Umdat ‘l-Qāri, Badr ‘l-Dīn al-’Aynī [13/456].

[9] Sunan ‘l-Nasā’ī [#2479].

[10] Jāmi’ ‘l-Tirmidhī [#637].

[11] ’Umdat ‘l-Qāri, Badr ‘l-Dīn al-’Aynī [13/456].

[12] Fatḥ ‘l-Qadīr, Ibn ‘l-Humām [2/216].

[13] Musnad Aḥmad [2/178 #6667].

[14] Sunan Abū Dāwūd [#1565].

[15] Mustadrak ’alā ‘l-Ṣaḥīḥayn, al-Ḥākim [3/468 #1388]. Ḥāfiẓ Ibn Ḥajar al-’Asqalānī said in al-Talkhīṣ ‘l-Ḥabīr [2/494 #859]: ‘It’s chain is upon the conditions of the Ṣaḥīḥ’.

[16] Muḥammad b. ’Amr b. ’Aṭā’ is known, and is an authentic narrator, please refer to: Siyar A’lām ‘l-Nubalā’, al-Dhahabī [5/225] who said: ‘…one of the trustworthy narrators’, and Taqrīb ‘l-Tadhīb, Ibn Ḥajar [1/499 #6187] who said: ‘trustworthy’, also refer to Tahdhīb ‘l-Tahdhīb [9/384 #8616] for a full discussion on the narrator.

How Much Is Sadaqah Fitr??

[Mujlisul Ulama]

There  is  some  unneeded,  superfluous  difference  of  opinion regarding  the  Sadqah  Fitr  amount.  One  Molvi  Sahib  stating  his opinion says:

“One  of  the  purposes  of  Sadaqatul  Fitra  is  that  the  less fortunate  be  enabled  to  enjoy  some  of  the  same  benefits  of  Eid  as  their  more  entitled  Muslim  brethren.”  

The  Molvi  Sahib  has  misunderstood  the  objective  of  Sadqah  Fitr.  Primarily,  Sadqah  Fitr  consists  of  a  measure  of    the  staple  food  of  the  poor.  Thus,  the  Shariah  has  explicitly  ordered  that  Sadqah  Fitr  be  primarily  paid  with  grain  –  wheat,  rice,  or dates  and  the  like. 

Sadqah  Fitr  is  not  to  provide  a  sumptuous  meal  of  meat,  pies,  samoosas,  biryaani,  cakes,  deserts,  etc.  This   is  not  the  objective  of  Sadqah  Fitr.  The  Maqsad  is  to  ensure  that  every  poor  Muslim  has  sufficient  food  on  the  Day  of  Eid.  The  fact  that  it  is  permissible  to  distribute  one  Sadqah  Fitr  amount  to  more  than  one  Faqeer  adequately  nullifies  the  contention  of  the  Molvi  Sahib.

The  Shariah  has  stipulated  one  Sa’  (a  measure  of  approximately  3.5  kilograms)  of  grain  (Shaafis)  or  half  a  Sa’ (Hanafis)  as  the  Sadqah  Fitr  amount.  This  is  a  Mansoos  Alayh  Hukm.  This  measure  has  been  explicitly  confirmed  by  all  the  Math-habs  and  it  has  been  in  operation  in  the  Ummah  since  the  age  of  Rasulullah  (Sallallahu  alayhi  wasallam).  As  far  as  we  are  aware,  it  is  only  in  South  Africa  where  some    Molvis  have  differed  with  this  14  century  Ijmaa’i   law  of  the  Shariah. It  is  indeed  most  audacious  to  venture  an  opinion  which  conflicts  with  a  law  on  which  there  has  been  Consensus  of  the  entire  Ummah  for  more  than  fourteen  centuries.

The  insistence  on  giving  only  specific  grain,  not  flour,  not bread,  not  money,  etc.  as  Sadqah  Fitr  is  remarkable  in  the Hambali  and  Shaafi’  Math-habs.  The  Sadqah  is  not  discharged  if  cash  or  biryaani  or  rice  or  meat  or  samoosas  or  any  other  type  of  food  is  given  even  if  the  monetary  value  is  in  excess of  any  value/amount  suggested  by  the  Molvi  dissenters  who  have  broken  from  the  Ijmaa’ of  the  Ummah.

The  Molvi  Sahib  avers: “The  amount  touted  this  year  is  the  lowly  sum  of  R22.  How  can  this  figure  be  justified,  especially  when  comparing  it  against  our  laden  tables  on  Eid  day?”  

The  Molvi  Sahib  has  missed  the  bus.  He  is  way  off  the Shar’i  track.  This  erroneous  conclusion  is  the  product  of  his  primary  erroneous  premiss  which  has  been  rebutted  above.  Comparison    with  the  laden  tables  of  the  wealthy  is  not  the  standard  for  calculating  Sadqah  Fitr.  The  Shariah  does  not  debar  anyone  from  contributing  such  funds  to  the  poor  which  could  procure  for  them  the  sumptuous,  albeit  physically  and spiritually  ruinous  dishes  which  Muslims  devour  nowadays.  People  are  free  to  give  voluntary  Sadqah  in  any  amount  they  desire.  But  to  tamper  with  the  laws  of  the  Shariah  is  neither  permissible  nor  acceptable.  In  the  attempt  to  provide  luxury  food  items,  it  is  highly  improper  to  seek  a  re-interpretation  of  the  fourteen  century  law.  Rather,  the  Molvi  Sahib  should encourage  and  exhort  Muslims  to  open  up  their  hearts  and  to contribute  Sadqah  generously.

If  people  contribute  even  a  small  percentage  of  the  huge amounts  which  they  squander  in  unnecessary  luxuries,  haraam  functions,  etc.,  then  there  will  be  ample  funds  available  to  feed  the  poor  with  the  type  of  sumptuous  dishes  mentioned  by  the  Molvi  Sahib.  To  say  the  least,  it  is  indeed  peculiar  to    seek  a  re-interpretation  of  a  law  of  the  Shariah  cast  in  rock.  It  is essential  to  remember  that  the  objective  of  Sadqah  Fitr  is  not  biryaani,  samoosas,  pies,  carrion  chickens  and  the  mounds  of processed  flotsam  ‘foods’  with  which  Muslims  are  destroying  themselves  physically  and  spiritually.  The  Shariah  has  selected  for  the  poor  their  staple  diet  which  is  best  for  their  general  health.

The  Molvi  Sahib,  campaigning  for  a  change  to  the  Shariah’s  ruling,  cries:  “I  appeal  to  all  Muslim  brothers  and  sisters  to  do  some  introspection  –  per  portion  of  what  your  Eid  meals  cost.”   The  Molvi  Sahib   has  calculated  that  for   their  ‘huge  breakfasts,  biryani,  braais  and   suppers”  it  costs  about  R100  per  person,  hence  this  is  his  criterion  for  determining  the  Waajib  Sadqah  Fitr.  

Payment  of  Sadqah  Fitr  is  Waajib.  Non-payment  is  sinful,  and  the  fasts  of  Ramadhaan  are  suspended  between  the  earth  and  heavens  as  long  as  the  Fitrah  remains  unpaid.  Now  if  someone  does  not  pay    R100,  will  he  be  sinful?  Will  he  be  perpetrating  a  major  sin,  the  consequence  of  which  is  Hell-Fire?  If  the  answer  is  no,  then  the  imposition  of  R100  is  a  stupid  futility.  If  the  answer  is  yes,  then  we  ask:  Did  the Molvi  Sahib  receive  Wahi  to  fix  this  amount?  Has  he  solid Shar’i  substantiation  to  impose  his  R100  as  a  Waajib  obligation  on  the  Ummah?  It  is  quite  obvious  that  the  R100  is  the  Molvi’s  personal  opinion  unbacked  by  any  Shar’i  daleel.

Furthermore,  the  Molvi’s    determination  is  in  flagrant  conflict  with  the  Shariah’s  ruling  of   one  or  half  Sa’  of  grain.  The  biryani  and  braai  aspects  play  absolutely  no  role  in  the determination  of  Sadqah  Fitr.    The  criterion  is  the  measurement   and  the  staple  food  of  the  Fuqara  in  particular.  The  measurement  is  the  Sa’,  and  the  staple  food  is  generally  wheat  or  rice,  etc.  Any  conflicting  view  is  to  tamper  with  the  Shariah.

In  our  environment,  there  are  hardly  any  Fuqara  who  qualify  for  Sadqah  Fitr.  While  there  are  many  who  qualify  to  accept Zakaat,  there  are  almost  none  for  Sadqah  Fitr.  Genuine  Fuqara  and  Masaakeen  are  in  other  lands  where  a  single Fitrah  amount  is  greatly  appreciated  and  where  it  can  feed  a  family  for  the  day  with  their  staple  food.  Even  the  ‘poor’  here  own  cell  phones    for  savouring  pornography.  The  R22  Fitrah  will  suffice  for  a  couple  of  cell  phone  cards.  The  ‘poor’  here  are  not  in  need  of  staple  food  for  which  R22  is    more  than  adequate.  Yes,  it  is  not  adequate  for  haraam  braais  and  carrion  chickens, but  such  issues  are  unrelated  to  Sadqah  Fitr.

The  Molvi’s  mention  of  the  ‘Pleasure  of  Allah’  in  the  context  of  Sadqah  Fitr  is  misplaced.  Muslims  are  always  encouraged  to  spend  on  the  poor  generously.  This  is  not  reliant  on  Sadqah  Fitr  nor  restricted  to  the  Day  of  Eid.  There  is  absolutely  no  need  to  tamper  with  the  Sadqah  Fitr  law  for  exhorting  people  to  be  kind,  generous  and  helpful  to  the  poor  and  destitute.  Such  kindness  is  Waajib  all  year  round  and  is  unrelated  to  Sadqah  Fitr.

Unthinkingly,  the  Molvi  Sahib  says:  “For  anyone  objecting  to this  (i.e.  to  the  R100  fitrah  opined  by  the  Molvi  Sahib),  there  is  also  a  mention  in  the  Hadith  about  one  Sa’a  of  dates (approximately  2  kilograms). How  much  is  that  today?”  

If  the  Molvi  Sahib  had  applied  his  mind,  he  would  not  have  made  this  futile  observation.    The  Sa’  of  dates  is,  firstly, optional.  The  Ahaadith  allow  several  options.  Payment  of  Fitrah  is  not  fixed  with  dates  or  wheat  or  barley,  etc.  It  is  the  staple  food  of  a  community.  Secondly,  dates     for  South  African  Muslims,  including  the  very  poor,  is  not  a  food  consumed  to  fill  the  stomach.  It  is  not  their  staple  food.  In  fact,  even  in  Arabia, it is  no  longer  the  staple  food.    Thirdly,  there  is  no  Shar’i  obligation  to  compute  the  Sadqah  Fitr  amount  with  the dates  yardstick.  The  criterion  is  the  staple  food  of  a  people.

In  South  Africa,  during  every  Ramadhaan,  tons  of  dates  are  distributed  to  the  poor,  apart  from  Sadqatul  Fitr.  Half  a  kilogram  is  not  used  by  most  people  over  an  entire  month. Towards  the  middle  of  Ramadhaan,  we  hand  boxes  of  dates  to  brothers  to  seek  out  takers.  While  people  will  devour  many  kilograms  of    halaalized  diseased  carrion  chickens,  they  consume  dates    frugally  in  South  Africa.  It  is,  therefore,  not  a  standard  for  the  calculation  of  Sadqah  Fitr.

A  campaign  to  encourage  Muslims  to  contribute  money  for  the  needs  of  the  poor  is  always  welcome  and  an  act  of  great  merit.  But  the  basis  for  such  campaigns  should  not  be  mutilation  of  the  Shariah’s  ahkaam  by  self-opinion  and  baseless  interpretation  stemming   from  fancy  and  whim.  Today  the  desire  is  to  tamper  with  the  Shariah’s  stipulated  Fitrah  amount.  Tomorrow  this  satanic  re-interpretation   will  be  extended  to  Zakaat.  Instead  of  2.5%,  some  Molvi  Sahib  will  suggest  that  it  should  be  5%.

Let  us  now  see  what  the  Fuqaha  of  Islam  say  regarding  Sadqah  Fitr.

“Regarding  that  which  is  Waajib:  The  Waajib  amount  is  half  Sa’  of  wheat  or  one  Sa’  barley  or  one  Sa’  of  dates according  to  us  (i.e.  the  Hanafis).”  Ash-Shaafi  said:    One  Sa’ of  wheat…….The  flour  of  wheat  and  barley  is  the  same  according  to  us  (Ahnaaf).”     [Badaaius Sanaa’] 

If  the  Sadqah  is  paid  with  raisins,  the  ruling  according  to  the  Ahnaaf  vacillates  between  a  Sa’  and  half  a  Sa’.  The  reasoning  underlying  the  half Sa’  of  raisins,  is:

“The  price  of  raisins  is  normally  more  than  the  price  of  wheat,  hence  half  Sa’  raisins  suffices……..It  is  possible  to  reconcile  the  two  different  views  (Imaam  Abu  Hanifah’s  view  and  the  view  of  Saahibain  regarding  raisins)  by  means  of  determining  the  Waajib  amount  on  the  basis  of  the  price.  During  the  era  of  Imaam  Abu  Hanifah  the  price    (of  raisins)  was  the  same  as  that  of  wheat,  and  during  the  time  of  Saahibain  the  price  was  as  the  price  of  barley  and  dates.”  [Badaaius Sanaai’]

The  wheat  standard  adopted  by  our  Fuqaha  is  most  significant  in  understanding  the  wisdom  underlying  the    obligation  of  Sadqah  Fitrah.    In  terms  of  value,  a  Sa’  of  raisins  was  higher  than  the  value  of  a  Sa’  of  wheat.  Despite  payment  of  Fitrah being  of  greater  merit  in  terms  of  money  than  grain  according to  the  Ahnaaf,  and  despite  the  value  of  a  Sa’  of  raisins  being having  a  higher  monetary  value,  our  Fuqaha  reduced  the   quantity  to  the  equivalent    of  the  value  of  wheat.  Although    it  would  have  been  in  the  interests  of  the  Fuqara  to  have  retained  a  Sa’  for  raisins,  this  principle  of  Anfa’lil  fuqara  (That  which  is   more  beneficial  for  the  Fuqara),  which  is    utilized  for  calculating  the  Zakaat  Nisaab,  has  been  discarded  for  determining    Sadqah  Fitr.  It  is  thus  clear  that  the  standard  is  the  staple  food  of  a  community  and  the  Sa’  measure.

The  Shaafi’  Math-hab  has  an  even  narrower  and  more  rigid  concept  of  Sadqah  Fitr

“That  which  is  Waajib  is  a  Sa’  according  to  the  Sa’ of Rasulullah  (Sallallahu  alayhi  wasallam)  because  of  the  Hadith  of  Ibn  Umar  (Radhiyallahu  anhu)……….Abul  Abbaas  and  Abu  Ishaaq  said  that  it  is  incumbent  with  the  staple  food  of  a  community…..  If  in  a  city  there  is  no  specific  staple  food,  then  it  (Sadqah  Fitr)  shall  be  paid  with    the  staple  food  of  the  nearest  city. …..

Our  Ashaab  (i.e.  the  Shaafi’  Fuqaha)  say  that  the  condition (for  the  discharge  of)  of  Sadqah  Fitr  by  means  of      the  staple foods  (of  communities)  is  that  it  should  be  (such  products)  in which  Ushri  is  Waajib.  Therefore  anything  besides  this  will  not be valid…….
Al-Maawardi  said  that  similarly  (i.e.  will  not  suffice  for  Sadqah  Fitr)  fish  and  eggs  even  if  these  are  the  staple  food  of some islanders.  In  this  there  is  no  difference  of  opinion.

With  regard  to  meat  (as  Sadqah  Fitr),  the  correct  view  is  that  As-Shaafi’  has  stated  explicitly    thereon  and  the  Ashaab  in  all  narrations  have  emphatically  said  that  it  is  not permissible…….. Similarly,  even  if  the  staple  food)  of  some  community  is  fruit  on  which  there  is  no  Ushri  such  as  figs,   etc.,  then  this  will  not  suffice  (for  Sadqah  Fitr).

Ash-Shaafi’  and  the  Ashaab  said  that  flour  and  saweeq  (barley  cereal)  will  not  suffice  just  as  the  value  (monetary value)  will  not  suffice.”  [Kitaabul Majmoo’]

The  above  is  a  very  brief  summary  of  the  Shaafi’  viewpoint.  There  is    considerable  elaboration  and  differences  regarding the  details  of  Sadqah  Fitr  in  the  Shaafi’  Math-hab.  However, the  differences  all  pertain  to  the  ‘staple’  food  and    the  measure of  the  Sa’.  But  the  staple  food  and  the  Sa’   are  the  two fundamentals  of  Sadqah  Fitr.

In  terms  of  the  Hambali  Math-hab  too,  the  criterion  is  the  Sa’  and  the  staple  food.

“(It  is)  the  Sa’  according  to  the  Sa’  of  Nabi  (Sallallahu  alayhi wasallam).  One  Sa’ is  Waajib  for  every  person….

Sadaqatul  Fitr  is  discharged  by  means  of  the  dominant staple  food  of  the  city….It  is  (also)  fulfilled  by  means  of  every  type  of  grain  which  is  the  staple  food  when  the  mansoos alay  types  are  not  available  (i.e.  wheat,  barley,  dates,  etc. mentioned  by  Rasulullah  –  Sallallahu  alayhi  wasallam).  From this  it  is  apparent  that   (other  items)  besides  this,  is  not  sufficient,  e.g.  meat  and  milk  (do  not  suffice  for  Sadqah  Fitr).

If  one  is  able  to  give  dates  or  raisins  or  wheat  or  barley  or iqat  (a  kind  of  cheese),  and  he  gives  something  else  besides (any  of  these  mansoos  alay  items),  then  it  will  not  suffice  (for  the  discharge  of  Sadqah  Fitr)  according  to  the  Zaahir  Mathhab.  Diverson  from  these  kinds  (mentioned  in  the  Hadith)  is  not  permissible  when  one  has  the  ability  to  (discharge  the  Sadqah)  with  it  regardless  of  the    ma’dool  ilayh  (the  other  item)  being  the  staple  food  or  not……..

Maalik  said  that  it  should  be  paid  with  the  dominant  staple food  of  the  city,  and  Ash-Shaafi’  said  that  any  staple  food  which  is  dominant  for  a person….

It  is  permissible  to  pay  (Sadqah  Fitr)  with  flour  and  saweeq  (a  cereal    of    barley).    Maalik  and  Shaafi’  said  that  it  is  not  permissible  with  these  two  items……………….

It  is  not  permissible  to  pay  Sadqah  Fitr  with  bread,  hareesah  (a  biryani  kind  of  dish),  kaboola  (oats)  and  their  like  (such  as  the  Molvi’s  biryaani,  braai,  pies,  carrion   chickens,  etc.)  because  it  (Sadqah  Fitr)  is  paid  by  means  of  measure  (i.e. the  Sa’)  and  items  which  are  not  perishable.  Nor  can  it  be  paid with  vinegar  and  dabs  (molasses)  because  these  are  not  staple  foods.

Imaam  Ahmad  said  (regarding  paying  Sadqah  Fitr    with money):  “I  fear  that  it  will  not  suffice  because  it  is  in  conflict with  the  Sunnah  of  Rasulullah  (Sallallahu  alayhi  wasallam).  ……Maalik  and  Shaafi’  held  the  same  view.”  [Al-Mughni – Ibn Qudaamah]

There  is  likewise  difference  of  opinion  on  the  details  of  staple  food,  nevertheless,   the  criterion  according  to  the Hambali  Math-hab  is  also  Sa’  and  staple  food,  not  biryaani,   braai  meat  and  carrion  chickens  which  has  become  a  kind  of  ‘staple  food’  for  the  Molvis  of  this  era.

According  to  the  Maaliki  Math-hab,  the  fundamentals  are  the same,  namely,  Sa’  and  the staple  food.

“The  dominant  staple  food  from  wheat,  barley,  rice,  corn, dates,  raisins,  and  cheese,  is  Waajib………. Paying  (the  Sadqah  Fitr)  with  that  which  is  not  the  dominant  staple  food  is not  valid  except  if  it  is  of  a  superior  kind,  for  example  if  the  staple  food  is  barley,  and  they  pay  with  wheat,  it  will suffice.”  [Al-Mathaahibul Ar-ba’ah] 

It  will  be   clear  from  the  aforementioned  citations  that  according  to  all  four  Math-habs,  the  determinants  for   Sadqah  Fitr  are  the  Sa’  and  the  staple  food  of  a  community.  In  all  the  Math-habs,  the  differences  centre  around  these  two  essential  requisites.  This  has  been  the  position  of  the  Shariah  since  the  time  of  Rasulullah  (Sallallahu  alayhi  wasallam).  It  is  only  in  our  time  that  some  Molvis  lacking  in  proper  understanding,  are  advocating  a  new  carrion  standard  which  is  in  total  conflict  with  the  Ijma’  (Consensus)  of  the  Ummah.

While  promoting  and  propagating  generosity  for  the  Fuqara   are   most  welcome,    this  should  not  be  at  the  expense  of  interfering  with  the  ahkaam of  the  Shariah.

Some rules of Sadaqah fitr

1.  Sadaqatul  fitr  or  Fitrah  is  waajib  (compulsory)  upon  all Muslims-  male,  female  and  children  who  on  the  Day  of Eid-ul-fitr  are  owners  of  the  Nisaab  of  Zakaat.  I.e. approximately  the  rand  value  of  the  current  price  of 19.6875  troy  ounces  or  612g  of  silver  (Hanafi  Math-hab). According  to  the  Shaafi  math-hab,  Fitrah  becomes  obligatory,  if  one  has  sufficient  food  for  one’s  household for  one  day  and  one  night  (24  hours).  Thus,  if  one  is  not  the  owner  of  the  Zakaat  Nisaab  value,  Fitrah  will  yet  be  compulsory  according  to  the  Shaafi  Math-hab.

2.  According  to  the  Hanafi  Math-hab,  the  Fitrah  becomes Waajib  when  the  Day  of  Fitr  dawns  with  the  commencement  of  Fajr  time.  Therefore,  if  someone  died  before  entry  of  Fajr  on  the  day  of  Eid,  Fitrah  will  not  be  paid  out  of  his  (the  deceased’s)  estate,  since  the  Fitrah  is  not  Waajib  upon  him.  And,  if  a  child  is  born  before  the  rising  of  FajrFitrah  will  be  paid  on  his  behalf.  If  the  child  is  born  after  the  entry  of  Fajr  (on  the  day  of  Eid),  Fitrah is not Waajib on his behalf.

3.  According  to  the  Shaafi  Math-hab,  Fitrah  becomes incumbent  with  the  commencement  of  the  night  of  Eidul-fitr,  i.e.  the  moment   the  sun  sets  on  the  last  day  of Ramadhaan.  Thus,  if  someone  dies  after  sunset  on  the  last day  of  Ramadhaan  (i.e.  the  first  of  Shawwaal)  Fitrah  shall be  paid  out  of  his  estate.  Fitrah  will  not  be  waajib  upon  a  child  born  after  sunset  of  the  last  day  of  Ramadhaan.

4.  According  to  the  Hanafi  math-hab,  the  father  has  to  pay  the  Fitrah  on  behalf  of  his  minor  children,  i.e.  those  who  have  not  yet  attained  the  age  of  puberty.

5.  According  to  the  Hanafi  Math-hab,  it  is  not  obligatory upon  the  husband  to  pay  the  Fitrah  on  behalf  of  his  wife. If  she  is  the  owner  of  the   Nisaab,  she  shall  pay  her  own  Fitrah.

6.  According  to  the  Shaafi  Math-hab,  it  is  obligatory  upon the  man  to  pay  the  Fitrah  on  behalf  of  his  minor  children  as  well  as  his  wife.

7.  If  a  minor  is  the  owner  of  wealth  to  the  amount  of  Nisaab, then  payment  of  Fitrah  on  behalf  of  the  minor  could  be  made  from  his  (minor’s)  wealth.  This  is  according  to  both  Hanafi  and  Shaafi  Math-hab.

8.  The  Fitrah  should  preferably  be  paid  before  the  Eid Salaat.

9.  It  is  not  permissible  to  delay  the  Fitrah  later  than  the  day of  Eid.  However,  if  it  was  not  paid  on  the  day  of  Eid  or  before,  the  obligation  remains  and  the  Fitrah  will  have  to be paid.

10.  It  is  permissible  to  pay  the  Fitrah  in  advance  at  anytime during  the  month  of  Ramadhaan.  This  is  according  to  both  Hanafi  and  Shaafi  math-hab.  However  according  the Hanafi  Math-hab,  Fitrah  could  be  paid  even  before Ramadhaan  whereas  according  to  the  Shaafi  Math-hab,  payment  of  Fitrah  before  Ramadhaan  is  not  valid.

11.  Sadaqatul Fitr  is  Waajib  upon  all  those  who  fasted  as  well  as  those  who  did  not  fast  for  some  reason  or  the  other. This  is  according  to  both  Hanafi  and  Shaafi  Math-hab.

12.  Fitrah  amount  is  the  price  of  approximately  1.75kg  flour according  to  the  Hanafi  Math-hab.  According  to  the  Shaafi  Math-hab  it  is  3.5kg  of  Flour.

13. Instead  of  cash,  Flour  may  be  given.

14.  Fitrah  can  only  be  paid  to  the  “poor”.  Those  who  are  entitled  to  accept  Zakaat.

15.  Fitrah  cannot  be  utilized  for  any  charitable  purpose  other  than  the  poor.  Therefore,  if  Fitrah  money  are accumulated  and  then  spent  on  some  other  charitable  cause,  the  Fitrah  obligation  of  the  Fitrah  payers  will  not  be  discharged.

WHEN DOES ZAKAAT BECOME FARDH UPON A PERSON??

Q: UPON WHOM IS ZAKAAT FARDH AND WHEN DOES ZAKAAT BECOME FARDH UPON A PERSON??

Answer by Jamiatul Ulama, Northern Cape:

The conditions for Zakaat to be Fardh (Obligatory) upon a person are as follows:

➡A person has to be a Muslim. (Kuffaar do not have to give Zakaat)

➡A person has to be free. (Today slavery does not exist. When slavery existed, Zakaat was not Fardh upon slaves)

➡A person has to be sane. (Zakaat is not Fardh on insane people)

➡A person has to be Baaligh. (Zakaat is not Fardh on those that have not yet attained puberty – immature persons)

➡A person needs to be the owner of the Zakaat Nisaab. (Nisaab is the minimum amount which a person must have for Zakaat to be Fardh upon one’s self. One needs to contact the Ulama in order to find out what is the Nisaab amount. A person who has less than the Nisaab amount, does not have to pay Zakaat. The
Zakaat Nisaab is the value of 612 grams silver)

➡The Nisaab must be over and above one’s basic needs and debts. (If a person has the Nisaab amount after deducting his basic expenses, but he has a debt which if deducted, would make him/her have less than the Nisaab amount, then Zakaat is not Waajib upon such a person)

➡After owning the Nisaab amount, a year has to pass for Zakaat to be Fardh upon the owner of the Nisaab amount. (A person got the Nisaab amount, but he did not have it for a full year, for example he had on 1 Muharram the Nisaab amount, but at the end of the year 30 Zul Hijjah, he did not have the Nisaab amount, it is not Fardh upon such a person to discharge Zakaat. Always remember that one’s year begins when one has the amount of Nisaab.)

Further Reading: Guide to Zakah – Understanding & Calculation

Not Paying Zakaat ! Beware Of The Athaab !

THE FOLLOWING episode was narrated by Hadhrat Maulana Ashraf Ali Thanvi (rahmatullah alayh), and it happened in Thana bavan where Hadhrat was resident.

A Mullaji had horded a sum of money which he kept in an earthenware vessel underground. He would almost daily open up the jar and count the money. His extreme love for the money prevented him from paying the compulsory Zakaat. Some youngsters who were his students had observed the daily practice of the Mullaji. One day during the absence of the Mullaji, they stole the money. With some of the money they prepared a lavish meal, and also invited Mullaji. Whilst eating, the Mullaji enquired about the occasion for having prepared such a sumptuous feast. The youngsters said: “Hadhrat this is as a result of your blessings.”

However, the Mullaji asked several times for the reason of the feast. But the youngsters each time responded with the same comment. When one boy sarcastically laughed, the Mullaji became apprehensive. It occurred to him that there was something sinister about the feast. He became so much disturbed that he discontinued
eating and hastened to his room. When he opened the jar, he was so terribly shocked to discover that his money was missing that he suffered a heart attack and died on the spot. The youngsters who had played the prank were remorseful. They informed the people of what had transpired. A pious Aalim, Maulana Sa’duddeen of the town told the people that the money which was the cause for the death of the Mullaji was accursed and that they should bury it with him. Thus the remainder of the money was put in a bag and buried together with  Mullaji.

A robber being apprized of this episode thought the Aalim was a moron hence he advised that such a considerable sum of money be wasted. During the night time, the robber opened the grave to steal the money. When he opened the grave, to his surprise he saw all the silver coins neatly spread out on the kafan of Mullaji. The coins were all sparkling very brightly. As the robber touched a coin, he let out a terrible scream. The extreme heat of the coin was unbearable.

In fear the robber fled. The sizzling pain would not disappear. Nothing could cool his burning finger. He had to keep his finger immersed in a container of cold water permanently. This would give him some relief. Whenever he removed his hand to change the water, the sizzling pain would compel him to scream. The mayyit
(Mullaji) was being tormented with the silver he had horded and whose Zakaat he had not paid.

The Qur’an warns those who do not pay Zakaat that their faces and bodies will be branded with the heated coins which they used to horde on earth.

Related Article: Guide to Zakah – Understanding & Calculation

Zakaat and the Solar Year

[Majlisul Ulama]

Zakaat is an Islamic institution which is a Fardh lbadat of fundamental importance. It is one of the fundamentals of Islam. There is no distinguishing between the two fundamentals, viz Salat and Zakaat, in so far as importance is concerned. Islam has attached a host of laws to this institution of Zakat. Like Salat, it is a great and an independant lbadat which will be discharged only if the Shari rules relevant to it are fulfilled. Zakat being a strictly Islamic lbadat, cannot be hinged onto worldly considerations which interfere with the correct discharge of this obligation. It is not to be made a secondary institution merely because of inconveniences caused to us by the laws of finance and economics of the kuffar. Here we refer to the ‘Nisab Time’. Zakat becomes payable after twelve Islamic months have passed upon the attaining of the Nisab value. Regarding this time-period, we say that the solar calendar or the Christian calendar does not suffice. It is essential that the Islamic calendar – or twelve Islamic months – be counted regarding the time-period of the Nisab.

SUGGESTED

In certain quarters it has been suggested that the Christian calendar too will be valid providing that 4% is added to the stock-figure obtained from the stock-taking after twelve solar months. Stock-taking is usually effected at the end of the financial year (which is after twelve Christian months) for income tax purposes. Muslim businessmen, therefore, employ these figures in the calculation of their Zakat, the argument being that it is too difficult to have two stock-takings – one for income tax and one for Zakat. The suggested addition of 4% to the stock-figure, is, ostensibly, to ‘rectify’ the discrepency which occurs as a result of the 11 day longer Christian calendar. However, in actual fact, the discrepency is not rectified by adding 4%. In fact, a number of serious discrepencies will result if the Christian calendar is employed for Zakat purposes. Hereunder we explain a few such serious discrepencies.

The Shariah does not apply Zakat tax to a part of the year. Zakat is payable for only full-year units. Hence, if Zakat has not been paid for two years, for example. then the only way of discharging the obligation is to pay Zakat for two years. If after two years and one month (for example) one decides to pay the past Zakat, one will be liable for two years’ Zakat and not for two years and one month, part of the year not being considered.

The addition of 4% resembles a penalty for late payment. But, the Shariah levies no penalty for late payment of Zakat.

Assuming that stock is taken 18 months after having attained Nisab, it will mean that the stock-figure has to be inflated by 50% since 6 months is 50% of the year, but this is at the end of the Islamic twelve months Mr Zaid had stock, cash and other Zakat-taxable wealth for the sum of R 20,000, but as yet he did not effect stock-taking because the financial year for income tax purpose has not yet ended. Eleven days after the expiry of the Islamic year, Mr Zaid takes stock on the 28th February and finds that his stock and other Zakat­ taxable assets amount to R 30,000. Now according to the ‘4% increase’ theory, the amount of R30 000 will have to be increased by 4%, giving a total of R 31,200 on which Zakat have to be paid, i.e. according to the ‘4% increase’ theory. However, according to the Shariah, Zakat should be paid on only the amount owned at the end of the Islamic year, which in this example is R 20,000. The additional R 10,000 by which the R 20,000 was augmented in the succeeding 11 days are exempt from Zakat. Zakat will be payable on the additional R 10,000 only at the end of the next twelve Islamic months, and that too if at the end of that period this amount remains in the form of Zakat-taxable assets. If during the course of the year this amount was lost, utilized or converted into non-Zakat wealth, e.g. motor car, building, furniture, etc., then Zakat will not be payable on it.

At the end of the Islamic twelve months Mr Amr had Zakat taxable assets for the amount of R 2,000, but as yet he did not take stock. Eleven days after (i.e. at the end of the financial year) he takes stock and discovers that due to some misfortune his Zakat-taxable assets were reduced to below Nisab. In this case, Mr Amr will not be liable for Zakat according to those who accept the Christian calendar for Zakat calculating purpose. But, according to the Shariah he is liable for Zakat on R 2,000 because at the end of the Islamic twelve months he was the owner of Zakat wealth for the sum of R 2,000.

At the end of the Islamic year Mr Bakr had Zakat-taxable assets for the amount of R 10,000, but as yet he did not take stock. Eleven days thereafter he takes stock. Within the course of the succeeding eleven days he had incurred debts for Now. according to those who accept the Christian calendar as valid for Zakat purpose, Mr Bakr will have to pay Zakat on only R 6,000 since according to the Shariah debts are deductable from Zakat-taxable assets. But, in actual fact Mr Bakr must pay Zakat on R 10,000 because the debts were incurred only after his Zakat became due on the R 10,000, hence, the debt of R 4,000 cannot be employed to offset Zakat payment in that sum.At the end of the Islamic year Mr Ahman had Zakat­ taxable wealth for the amount of R 100 which is below Zakat. A week thereafter he obtains by way of inheritance R 20,000. At the end of the financial year which occurred eleven days after the Islamic year, Mr Ahmad’s Zakat-taxable assets amounted to R 20,100. According to the ‘4% increase theory, Mr Ahmad has to pay Zakat on R 20,100 plus 4%. However, according to the Shariah he does not have to pay even one cent Zakat. He is not at all liable for Zakat on the R 20,000 since he did not own it at the termination of the twelve Islamic months.

At the end of the Islamic year Mr Qasim had R 8,000 worth of Zakat-taxable wealth but as yet he did not effect stock-taking. At the end of the financial year (which occurred eleven days after the Islamic year) he takes stock and finalises his accounts. During the course of the eleven days following the Islamic year (i.e. prior to stock-taking) Mr Ahmad converts R 6,000 of his Zakat-taxable wealth into non-Zakat assets, e.g. he purchased a motor car. Now according to his final figures realised after stock-taking the sum of R 6,000 will no longer reflect as Zakat ­taxable assets which will be an amount decreased by R 6,000, plus the suggested 4% increase on the stock-figure. But, according to the Shariah he is liable to pay Zakat on the  R 6,000 as well despite it having been converted into a non-Zakat asset because the conversion was effected after the Zakat became due on the amount.

At the end of the first twelve Islamic months Mr Zaid in actual fact had R 25,000 stock, but his debts amounted to R 25,000. Mr Zaid never took stock after the twelve Islamic months nor did he do so at the end of the financial year. The true position according to the Shariah is that Mr Zaid is not liable for Zakat because his debt eliminates his Zakat-taxable At the end of the following financial year Mr Zaid takes stock and finds that his stock is R 20,000 and his debts R 5000. According to the ‘increase’ theory he is liable for Zakat on R 15,000 plus an increase of 100%, i.e. he has to pay Zakat on R 30,000 because now the stock has not been taken 11 days after the Islamic year, but one year after the Islamic year. However, in actual fact, according to the Shariah, he has to pay Zakat on only R 15,000 (if this was the position of his Zakat assets at the end of the second Islamic year).

The theory to be employed in the event of stock being taken according to the solar calendar posits a 4% addition to the Zakat-taxable assets as at the end of the financial year calculated in terms of twelve Christian months. This percentage according to the theory remains constant, i.e. at the end of each successive solar year 4% will be merely added to the figures and Zakat levied on the total sum. This presents an unreal situation, for the percentage remains constant whereas the Islamic year in relation to the Christian year recedes by approximately 11 days (or the approximate 4% posited in the theory). In terms of the theory, the logical conclusion should be a successive increase of approximately 4% (3.1% to be more exact) per solar year since at the end of the first Christian year, the Islamic year would have lapsed by 11 days; at the end of the second Christian year, the Islamic year would have lapsed by 22 days, hence in terms of the ‘increase’ theory, the stock-figure will be inflated by 8% (6.2% to be exact); at the end of the third Christian year, the Islamic year would have receded by 33 days, hence in terms of the theory, the Zakat-taxable figure will have to be inflated by 9.3%, and so on. The percentage increase with which the Zakat wealth has to be inflated will increase with each year. This will provide 100% increase in the Zakat-taxable wealth after about 34 years. But, in no way does this ‘increase’ whether of 4% or 100% solve the discrepencies created by calculating Zakat at the end of the solar year. The ‘increase’ theory has no bearing to reality. It remains a fictitious and a groundless supposition.

Utilizing the solar year for Zakat purposes will magnify the incidence of error with each successive year which produces a constant recession of the Islamic year in relation to the Christian year. In the first year there will be an eleven-day gap between the Islamic and the Christian year; in the second year a twenty-two day gap; in the third year a thirty-three day gap, and so on. The greater the gap, the greater the danger of increased discrepency since more transactions could be effected in the greater time period. Every transaction involving Zakat-taxable wealth effected in this time-gap will affect the Zakat position. Zakat-taxable wealth which had been converted into non-Zakat-taxable items during this time-gap will be exempt from Zakat if the calculation is done at the end of the Christian year. And, all increases in Zakat-taxable wealth during this time-gap will be subjected to Zakat if the calculation is based on the Christian calendar. But, in terms of the Shariah, whatever Zakat-taxable assets have been converted into non­ Zakat-taxable items during the time-gap will be subjected to Zakat and all increases in Zakat-taxable wealth during the time-gap will be exempted from Zakat. Such increases will only be taxed by Zakat at the end of the next Islamic year, if such wealth still remains in one’s possession.

If Zakat is calculated on the basis of the Christian calendar, then one whole year will be missed out after about 33 years, and this ‘escaping’ of a year’s Zakat cannot be rectified or compensated by means of the unrealistic ‘increase’ even if at the end of the 33rd year the increase is 100%. The ‘gap’ between the Islamic and the Chrisitan years after 33 years will be one year, and in one year all one’s wealth may be depleted or lost, this bringing about the total ‘escape’ from Zakat even if 100% increase in the figures is effecteu. At the end of the 33rd Christian year, one may have Zakat-taxable wealth less than the value of Nisab whereas a year before when the time was due for the Zakat calculation one could have possessed a considerable sum of Zakat-taxable wealth.

If, for example, stock is taken only after two years and the figure for the stock is R 5,000 at this stock-taking. But, the amount of stock at the end of the first year was R 2,000. According to the ‘4% addition’ theory, the amount of stock will have to be increased by 100% since the stock was taken after two years. It will follow that Zakat should be paid on R 10,000 whereas in actual fact Zakat will have to be paid on only R 7,000 (R 2,000 for the first year and R 5,000 for the second year).