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Zakāt (Arabic: زكاة [zæˈkæːt], "that which purifies") is the practice of taxation and redistribution, including benefits paid to poor Muslims, imposed upon Muslims based on accumulated wealth. It is obligatory for all who are able to do so, and it is considered to be a personal responsibility for Muslims to ease economic hardship for other Muslims to eliminate inequality among followers of Islam. The practice is one of the Five Pillars of Islam, and it is the only pillar which enjoins Muslims to submit to Islamic statism.
The Qur'an talks about zakat in more than 30 different verses, mainly in the Medinan suras. In the quranic view, zakat is a way to redistribute the wealth, thus defining a charity-based economy with a particular interest in the poor and the dispossessed Muslims. Zakat is considered more than taxation. One must give zakat for the sake of one's salvation: while those who give zakat can expect reward from God in the afterlife, neglecting to give zakat can result in damnation. The giving of the zakat is considered a means of purifying one's wealth and soul. Non-Muslims are not required to pay zakat, but give a tax by a different name called Jizyah tax.
The hadith also admonish those who do not give the zakat. According to the hadith, refusal to pay zakat is a sign of hypocrisy, and God will not accept the prayers of such people. The hadith assert that the poor wouldn't be hungry if the rich gave zakat. But they also state that zakat purifies those who give it. It is believed that God safeguards the property of those who give zakat. On the day of Judgment, those who didn't give the zakat will be held accountable and punished.
The hadith contain advice on the state-authorized collection of the zakat. The collectors are required not to take more than what is due, and those who are paying the zakat are asked not to evade payment. The hadith also warn of punishment to those who take zakat when they are not eligible to receive it (see beneficiaries of zakat).
The caliph Abū Bakr, believed by Sunni Muslims to be Muhammad's successor, was the first to institute a statutory zakat system. Abu Bakr established the principle that the zakat must be paid to the legitimate representative of the Prophet's authority, Abu Bakr, who ensured that each man, woman, and child had a minimum standard income of 10 dirhams annually, later increased to 20 dirhams.
The second and third caliphs, Umar ibn Al-Khattab and Uthman ibn Affan, continued Abu Bakr's codification of the zakat. Uthman also modified the zakat collection protocol by decreeing that only "apparent" wealth was taxable, which had the effect of limiting zakat to mostly being paid on agricultural land and produce. During the reign of Ali ibn Abu Talib, the issue of zakat was tied to legitimacy of his government. After Ali, his supporters refused to pay the zakat to Muawiyah I, as they did not recognize his legitimacy.
Ultimately, the practice of state-administered zakat was short-lived in the early Islamic history. During the reign of Umar bin Abdul Aziz (717–720 A.D.), it is reported that no one in Medina needed the zakat. After him, zakat came to be considered more of an individual responsibility.
Today, conservative estimates of annual zakat is estimated to be 15 times global humanitarian aid contributions.
|Taxation in the Ottoman Empire|
Zakat is one of the five pillars of Islam, and is expected to be paid by all practicing Muslims who have the financial means (nisab). In addition to their zakat obligations, Muslims are encouraged to make voluntary contributions (sadaqat). The zakat is not collected from non-Muslims, although they are required to pay the jizyah tax.
The amount of Zakat to be paid by an individual depends on the amount of wealth and the type of assets the individual possesses. The Quran does not provide specific guidelines on which types of wealth are taxable under the zakat, nor does it specify percentages to be given. But the customary practice is that the amount of zakat paid on capital assets (e.g. money) is 2.5% (1/40). Zakat is additionally payable on agricultural goods, precious metals, minerals, and livestock at a rate varying between 2.5 (1/40) and 20 percent, depending on the type of goods. Zakat is separate from the practice khums, where Shi'ites are expected to pay one fifth of their income.
Zakat is only payable on assets continuously owned over one lunar year that are in excess of the nisab, a minimum monetary value. The nisab is calculated after adding the cash value of zakatable assets (gold, silver, cash, stocks, merchandise for business, livestock, etc.). Personal assets such as clothing, household furniture, and one residence are not considered zakatable assets. The nisab for all valuables (gold, silver, money etc.) is the value of 87.48 grams (7.5 tola) of gold or value of 612.36 grams (52.5 tola) of silver (at world prices) whichever is less. For example, if the value of 87 grams of gold is $3000 and 606 grams of silver is $400 then the nisab would be US $400 which mean if anyone has savings (in terms of money, gold or silver, etc.) of worth more than $400 then he/she has to pay zakat accordingly.
Today, in most Muslim countries, zakat is collected through a decentralized and voluntary system where eligible Muslims are expected to pay the zakat based on worship and love of God. Under this voluntary system, zakat committees are established, which are tasked with the collection and distribution of zakat funds. In a handful of Muslim countries including Saudi Arabia and Pakistan, the zakat is obligatory and is collected in a centralized manner by the state. In Jordan, Bahrain, Kuwait, Lebanon, and Bangladesh, the zakat is regulated by the state, but contributions are voluntary.
According to the Quran's Surah Al-Tawba, there are eight categories of people (asnaf) who qualify to benefit from zakat funds.
“Alms are for the poor and the needy, and those employed to administer the (funds); for those whose hearts have been (recently) reconciled (to Truth); for those in bondage and in debt; in the cause of Allah; and for the wayfarer: (thus is it) ordained by Allah, and Allah is full of knowledge and wisdom.”
M.A. Mohamed Salih explains this verse to list the following as zakat's recipients:
Mohamed Ariff states that new converts to Islam were also paid from zakat fund.
According to the Hadith, the family of Muhammad should not consume any Zakat. Zakat should not be given to one's own parents, grandparents, children, grandchildren, or spouses. Also, it is forbidden to disburse zakat funds into investments instead of being directly given to those who are in need.
Muslim scholars disagree whether zakat recipients can include Non-Muslims. Some state that Zakat may be paid to non-Muslims, but only after the needs of Muslims have been met.
Neither the Quran nor the Hadiths specify the relative division of zakat into the above eight categories. This led to one group becoming prominent category of claimant for most of the zakat while other seven receiving insignificant portion of the zakat collected. Depending on the region, the dominant portion of zakat went typically to Amil (the zakat collectors) or Sabīlillāh (those fighting for religious cause or working in the cause of God such as missionaries proselytizing non-Muslims to convert to Islam). These primary sources of sharia also do not specify to whom the zakat should be paid - to zakat collectors claiming to represent one class of zakat beneficiary (for example, poor), collectors who were representing religious bodies, or collectors representing the Islamic state. This has caused significant conflicts and allegations of zakat abuse within the Islamic community, both historically and in modern times.
Fi Sabillillah is the most prominent asnaf in Southeast Asian Muslim societies, where it broadly construed to include funding missionary work, Quranic schools and anything else that serves the Islamic community (ummah) in general. Zakat can be used to finance a Jihad effort in the path of Allah. Zakat money should be used provided the effort is to raise the banner of Islam.
Additionally, the zakat funds may be spent on the administration of a centralized zakat collection system. There is an on-going controversy as to whether those claiming to be fighting a war on behalf of an Islamic country or for Islam can be a rightful recipient to zakat funds from Muslim community.
|This section requires expansion. (July 2011)|
The zakat is considered by Muslims to be an act of piety through which one expresses concern for the well-being of fellow Muslims, as well as preserving social harmony between the wealthy and the poor. Zakat promotes a more equitable redistribution of wealth and fosters a sense of solidarity amongst members of the Ummah.
Zakat is meant to discourage the hoarding of capital and stimulate investment. Because the individual must pay zakat on the net wealth, wealthy Muslims are compelled to invest in profitable ventures, or otherwise see their wealth slowly erode. Furthermore, means of production such as equipment, factories, and tools are exempt from zakat, which further provides the incentive to invest wealth in productive businesses.
In the United Kingdom, according to a self-reported poll of 4000 people conducted by Zarine Kharas, Muslims today give more to charity than people of other religions,. Measured in US Dollars, Muslims, on average, gave $567, compared to $412 for Jews, $308 for Protestants, $272 for Catholics and $177 for atheists. Today, conservative estimates of annual zakat is estimated to be 15 times global humanitarian aid contributions.
|obligatory upon Muslims||obligatory upon Dhimmis|
|net worth of assets must exceed the Nisab (excess money for personal need) for Zakat to be obligatory||required even if the Dhimmi's wealth or property does not exceed Nisab|
|only payable on assets continuously owned over one lunar year that are in excess of the Nisab||paid according to a contract, but usually paid yearly regardless of Nisab|
|the amount of Zakat paid is fixed and specified by Sharee'ah||the amount paid is not fixed or specified by Sharee'ah, but is at least one gold Dinar with no maximum amount |
|paid only by the owner of the assets himself/herself||paid by all able-bodied adult males of military age and affording power|
|refusal to pay Zakat has no specific punishment by Sharee'ah law in life; punishment is delayed to the end time||refusal to pay Jizya is considered a breach of The Dhimma contract; as a consequence the Dhimmi's blood (life) and assets would become permissible|
|should be paid seeking God's pleasure [Qur'an 30:39]||is a tax on non-Muslims.|