AUDIO FILESThis is a presentation by Abdullah Seymour on the modern political and traditional fiqh position of Zakat followed by a Q&A session on more general spects pf Zakat with Shaykh Ali Laraki and Hajj Abdalhaqq Bewley. This was broadcast live from the Muslims of Norwich website
There were a number of presentations streamed over the course of Ramadan
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by Hajj Asadullah Yate
Fair trading (‘adl) in the market-place is based on trust. The establishment of healthy trade is an act of worship, modelled upon the trading practice of the Messenger of Allah, may the peace and blessings of Allah be upon him.
As a principle, any exchange of goods is permitted as long as it does not involve;
1. forbidden commodities (e.g. wine, pig)
2. usury (any increase without corresponding counter-value)
3. uncertainty (e.g. sale of wheat before it is harvested, or fish before they are caught)
4. fraud (e.g. charging higher prices to travellers unaware of local prices)
5. extortion (e.g. manipulation of market conditions, monopoly, monopsomy)
Customary Practice
Fair trading is also based on a community’s understanding of the value of things, that is, their customary practice (‘urf); the local community must be left to make its own evaluation of goods. It cannot be an evaluation imposed from above or from outside.
Usury
Usury is the most pernicious destroyer of equity in the market-place and is the gateway to social imbalance and oppression and the proliferation of other malpractices. Previous generations took great pains to identify those transactions in which elements of usury had been introduced wittingly or unwittingly.
However innocuous a usurious transaction may seem, there is always an underlying element of gain for one party at the expense of loss for the other. Those engaged in such activity, Ibn Rushd states, “pay out money and receive more back without performing any deed or assuming any liability”.
Ibn Rushd insisted on the social importance of this question. “It is obvious from the sharicah that the reason for prohibiting usury is to prevent the fraud that it entails. Justice in transactions consists in close approximation and equivalence [between the goods exchang-ed]“.
Means of Exchange (Currencies)
Currencies exist in any trading situation. Ibn Rushd indicates the purpose of currency: “Since it is difficult to equate the values of things whose natures are different, dinars and dirhams are used to price them”. Here gold coins (dinars) and silver coins (dirhams) and similar non-perishable, easily quantifiable commodities with intrinsic value, not bank-notes, are referred to.
It is acceptable for those in authority to standardise currency to ensure its reliability, e.g. by issuing assayed and weighed gold and silver coins. It is against market equity for the authorities or any cartel, such as the banks, to monopolise the means of exchange. This enables the authorities, whether of bank or state, to debase the coinage (which is a hidden, and forbidden, taxation!) which is usurious because the authorities can contract debts at one value in real terms and pay them back at other values.
The creation of monopoly in the means of exchange also allows the appearance of fiat money ie. currency, based on faith, with no intrinsic worth, such as paper or electronic credits, whose value is imposed politically. This involves the fraudulent exchange of real assets for worthless tokens and facilitates the usurious manipulation of devaluation, inflation and deflation.
The Sale of Commodities
In order to prevent usury, you can only exchange commodities sold by weight and measure i.e. staple foodstuffs, gold and silver, for the same type of commodity e.g. minted gold for unminted gold or good dates for poor dates, when you exchange equal weight for equal weight, measure for measure, with no deferral of payment. Ibn Rushd explains it thus: “Given that there are no radical differences between specimens of the same type, when their uses are approximately the same, and that the person in possession of one type has no pressing need to exchange it for another of the same type, except by way of extravagance, equity is obtainable only on the basis of equivalence in terms of weight and measure”. In other words it is permitted, albeit regarded as an ‘extravagance’, to exchange patna rice for basmati, but only as long as the weight of the patna equals that of the basmati.
Forbidden Sales in Commodities
Ibn Rushd lists eight examples of sales, each of which demonstrates how usury enters into sales of commodities.
1. “Give me respite [from repayment of a debt or payment for goods bought on credit] and I will increase [the amount to be paid]“. (In other words the borrower or purchaser, addressing the lender or seller, says “Give me more time to pay the debt and I will pay you back more”).
2. A sale with forbidden disparity. (This refers to staple, storable foodstuffs, gold and silver which cannot be exchanged ‘with each other’ with disparity: thus an exchange of 1 gold coin for 10 silver coins is permitted but an exchange of two pounds of poor quality dates for one pound of good quality dates is not. If good quality dates are required, the poor quality dates must be sold and good quality dates bought with the proceeds).
3. A sale with forbidden delayed payment. (This refers to gold in exchange for silver, dates in exchange for raisins, or wheat etc., etc., which although of different types cannot be exchanged with each other when payment of one of the two is not immediate).
4. A sale combined with a loan. (All contracts which are composed of more than one transaction are forbidden).
5. A sale of gold and merchandise for gold. (This is because, in effect, gold is being sold for gold with disparity Ð the merchandise only obscuring the transaction).
6. The sale known as ‘reduce the amount in return for immediate settlement’. (This is a kind of usury in which the borrower who has agreed to pay back money by a certain date offers to pay a smaller amount before this date Ð now known as discounting of bills or factoring of debts).
7. The sale of foodstuff which has not yet been received in full [by the seller]. (Actual possession must be taken of all foodstuffs before their resale).
8. A sale combined with a money change. (Again, this is a trans-action in which the equivalence demanded of any money change is obscured by the accompanying sale and is also two transactions in one contract).
Ibn Rushd cites “the protection of wealth and prevention of squandering” as Malik’s explanation for the prohibition of usury. He also mentions Ibn al-Majishun’s explanation as “preservation of property (hiyata al-amwal) meaning that fraud should be prevented”.
The term “usury” has a much wider definition than that of [modern] English law: usury, in effect, can occur in almost any transaction: thus pure sales, barter transactions, money exchanges, speculation, the leasing of land for a share of its produce, control through monopoly etc. are all subject to the prohibition of usury if unjustified increase occurs to one party.
The Elimination of Parasitical Third Parties
What is significant for us is that parasitical third parties, state interference, commercial taxes and devious practices have no place in the Muslim trading world: there can be no money lenders, no bankers, no speculators, no stock exchanges, no promissory notes, no bonds, no lotteries. Traders must be free to operate within a basically healthy arena in which the pillars of sound trade are in place, namely free access to gold and silver as currency and the right to choose any means of exchange, unfettered by the tyranny of paper, plastic or computerised money, free of the monopoly of the banking system which governs all financial and political transactions today.
In the concluding remarks to the Bidaya al-Mujtahid Ibn Rushd points out that the underlying rationale of all transactions regulated by the law is the establishment and maintenance of human virtues, in this case that of justice. The way of the Muslims, the shari’ah, is composed of various behavioural patterns or sunnas. The prohibition of usury, risk and speculation are among the sunnas which “relate to the pursuit of justice and the avoidance of oppression: these are the kinds of sunna which demand equity in financial matters (al-’adl fi’l-amwal) and justice amongst people.”
TRADE
Traders move goods from a place, where these goods are in abundance, to another where there is a market for them. The trader expends energy in his going out to find suitable goods, in securing a reasonable price for them, in transporting and guarding them safely, and finally in selling them to a second party. The usurers however rent out money, which by its nature is only tolerated by natural communities as a means of exchange, and merely wait for its return with increase. They produce nothing, do not contribute any work and do not incur any risk. They are parasitical third parties who borrow from one source at one rate and lend to another at a higher rate thus preventing direct contact between investors and entrepreneurs. The most sophisticated form of usury is the establishment of ‘national banks’ which gather up a country’s gold and silver, prohibit its use by the people, print paper money – of which they have the monopoly Ð in its stead and then raise or decrease its ‘value’ (by devaluation, inflation or exchange-rate adjustments) to create speculation and the opportunity for vast profit.
Trade is generated from the face to face meeting of men who do not negotiate with any third party, be it in the guise of state tax regulations, customs tariffs, bankers, brokers, insurers or specialists in ‘international’ law. A trader’s handshake or his word is enough to seal a contract.
CONTRACTS
A contract is an act of trust between two people. Its reality extends beyond the material exchange of two commodities. A trader knows that his reputation for honest dealing is the key to swift and uncomplicated exchanges. Written contracts are drawn up whenever the exchange of goods or payment is delayed and the two parties see this to be of mutual benefit Ð when agreed delivery dates and precise measurements of commodities to be supplied in the future, for example, might otherwise be forgotten. Likewise witnesses may be signatories to a contract if their presence facilitates trust between the two parties.
In general, a contract Ð that is an offer and an acceptance and the obligation [to supply or pay for something] Ð is binding upon the parties when the buyer accepts the seller’s offer, before the two parties separate. When the buyer takes possession of the goods he usually accepts liability for them. There is, however, a warranty period, during which the buyer may return the goods to the seller and recover his payment if he discovers a defect in the goods. This is as long as the two parties have not agreed upon a waiver of this warranty (bara’a) during their meeting. The seller may not normally impose any condition on the buyer restricting the latter’s ownership of the goods.
FORMS OF CONTRACT
The Prophet, may the peace and blessings of Allah be upon him, sanctioned qirad investments which exclude any usurious third party: by it the investor (rabb al-mal) makes over a certain sum of money (in gold or silver) to an ‘agent’ (al-’amil). The agent uses these funds to trade and pays back the capital plus a previously-agreed percentage of the profits to the investor when the goods bought with the funds have been sold. The increased return on the initial investment is equitable as it is a loan which incurs risk for both parties: if the agent makes a loss (on the investment and on his time and work) the investor will also make a loss.
Partnership
Partnership likewise excludes usurers. By it, two or more parties come together and contribute equal shares of money, goods, equipment and work (shirka al-amwal), and then divide the profit between themselves equally. If the contribution from one partner (of either money, goods, equipment or work) is greater than the other partner, equity must be established by a division of the profits which is in proportion to this disparity. Equity may also be established in a partnership by one partner contributing all the equipment, for example, and the other contributing all the goods, as long as the rental value of the equipment and the profit-potential of the goods is approximately the same. Partnerships based solely on persons’ work (shirka al-abdan, i.e. when two cobblers come together and ’share’ the same customers) must be located under one roof. Each partner is liable for delivery of orders taken by the other. When partnerships are based on money, each partner is free to buy and sell with the ‘pooled’ money of the partnership (that is a mufawada part-nership of mutual delegation); when trading out of their localities, partnership funds may be used for travel expenses and maintenance of each partner’s family. It is, however, permitted to restrict the use of the ‘pooled’ resources by a mutual agreement to only buy and sell with both partners’ knowledge.
Shirka fi’l-bai’
A shirka fi’l-bai’ contract is one in which one party says to the other: ‘Make me an equal partner in this article belonging to you on condition that I sell it for you’. In effect what happens in this transaction is that the article is transferred to the first party without payment of money. It is equitable, however as the first party has become a partner in the article and pays for it by undertaking to sell it (in this respect it is not dissimilar to a contract of hire whereby the owner ‘hires’ the services of another party and pays for this hire by making him a partner in the goods). When he does sell it, he pays back half of the original value of the article to the second party together with half of the profit realised by their partnership. The ‘owner’ of the goods may fix a minimum price or the expected profit margin for the article which the other will sell.
Murabaha
A murabaha sale is one in which a trader goes to another city and states prior to a deal that he is selling a commodity for such and such an amount above his cost price. This transaction is permitted as it is essentially the same as buying and selling: it is equitable as both partners are legitimate traders who both agree on the nature and quality of the subject matter of sale and their profit margin prior to any dealing. It is based on the first party’s trust that the other partner will always only add on, for example, 10% profit for himself on top of the price of the goods and his expenses incurred in procuring and delivering them.
Salam
In any sale/exchange, payment and the taking delivery of the goods is normally simultaneous. A salam contract is a form of sale on delayed terms in which the money (or anything used in payment) may be paid first and the goods delivered at a later date. This is to permit the making of a contract for goods which are in another country or only available, for example, on the market day of the following month. The precise date of delivery must be stipulated. The commodities exchanged must be different to each other in kind or in use, and must not involve the exchange of food for food or gold for silver. The salam contract does not stipulate that a specific object will be delivered at such and such a date but rather stipulates the type of object, like a horse or a sword. A nasi’a contract is similar except the money is paid later. It is not permitted, however, that both payment and delivery of the thing paid for are delayed. In any sale, be the payment or delivery of goods immediate or delayed, transfer of ownership is effected at the time of the deal (i.e. immediately the offer of the first partner is accepted by the first).
Ijara
A rental contract (kira’, ijara) is one in which one party, the leaseholder (al-mustajir), pays for the temporary use of a house, beast, or piece of equipment. The contract must stipulate the hire-charge, the period of hire and the location in which the thing hired is to be used. The owner (al-malik) of the rented article is liable for any damage to the article. Similar to this are contracts of hire regarding persons engaged to work for a daily, weekly or monthly wage (ijara) or to complete a specific job for a specific reward in a time which is not specified (jucal). Although it is permitted to ‘hire’ someone to buy you something it is not permitted for you to ask him to use his own money on the understanding that you will pay him back later.
Markets
The Amir sets aside areas as markets in which the people may come to sell their goods. The stalls or shops are ideally of a non-permanent nature, erected merely for the protection of the traders and the goods from the weather. They are there so that those who want goods from artisans, farmers and agents may buy them from them. People set them up at times of harvest, on the arrival of caravans and for a variety of other seasonal and social reasons. They are not a prelude to the establishment of fixed, structured shops, grocers, engrossers, wholesalers or ’supermarkets’. These latter only hoard and monopolise commodities in order to control and manipulate prices. Markets, when they reach this stage of ‘development’, become a barrier to free exchange for those who wish to buy and sell at a modest level. All such practices (known as engrossing and regrating in English law) were outlawed by edict until the introduction of foreign ‘Banking’ law (i.e. the law of the moneylenders and hoarders) at the beginning of the 18th century.
Caravans
A caravan is a group of traders, qirad agents, partners or artisans who travel together to establish new markets or take part in existing markets outside their home countries in order to buy and sell. Their travelling together affords the protection of a company of men, and protection from the dangers of the open road. They should not have to pay any taxes in the establishment of these markets. They only require the permission of the local Amir. It is not permitted for people to go out to meet the caravan before it has arrived in a town in order to buy goods wholesale and at a lower price than the goods would otherwise have fetched on the open market (forestalling).
Zakat
We must recognise the obligation of paying zakat-tax on wealth to the Amir as well as and at the same time as establishing free markets. Payment of the zakat purifies and increases the wealth generated from trading, confirms traders allegiance to their Amir and ensures the distribution of surplus wealth to the poor, the needy, those fighting in the way of Allah and for justice, and other categories of persons.
Commenting on Allah’s words: “That which is given [as zakat-tax] is for the poor, the needy, those who work for this [zakat], for those whose hearts might come closer [to Allah], for slaves, for debtors, and in the way of Allah and for the traveller: [this is] an obligation from Allah, and Allah is the Knower, the Wise.” (Sura at-Tawba, ayat 60), Ibn Juzayy in his Qawanin says: “As for ‘those who work for this [zakat]‘, they are the persons who collect, distribute and record it, even if they have independent means. This depends upon their being just and knowledgeable of zakat-law.
As for ‘those whose hearts might come close [to Allah]‘, they are the kuffar, to whom it is given in order to encourage them to Islam.
Its distribution is according to the estimation of the Amir. It is permitted to give it to only one of the eight categories of persons mentioned in the Qur’an, or to give preference to one category over another. Moreover anyone who qualifies for two of the categories has a right to two shares.
It is not to be transferred from the region in which it was collected, except when there is an excess.
The zakat is not to be spent on building mosques, nor on burying the dead.
It is obligatory to pay the zakat to the Amir if he is just.”
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In recent days my morning study has led me to reading from Surah Tawba and simultaneously referring to the corresponding section in the Tafsir Jalalayn (of the two Jallaludin’s). The surah refers a lot to both Jihad and Zakat and thus indicates the link, or at least the similarities, between the two of them. Of course the 60th ayat is the one that spells out in no uncertain terms exactly who can receive collected Zakat
What really woke me up was the story of Tha’laba ibn Hatib who asked the Prophet, peace and blessings be upon him, to pray to Allah to provide him wealth in order to pay off his creditors (I know that feeling well) and the Messenger of Allah duly obliged and his wealth soon expanded. However, Tha’laba ibn Hatib then started not coming to the Jumu’a prayer and refused to pay Zakat. It appears that later the 76th and 77th ayats were revealed.“But when He does give them of His bounty they are tight-fisted with it and turn away….so he has punished them by putting hypocrisy in their hearts until the day they meet him…”
After that he came back to the Prophet, may Allah’s blessing be upon him, with his Zakat but the Prophet was now forbidden by Allah from collecting it and so refused, likewise did Abu Bakr, Umar and then Uthman.
Early on in the surah we are told of those who refused to go on Jihad with the Messenger of Allah, peace be upon him, and his companions and were then refused permission to go on later expeditions. May Allah protect us from their fate and the fate of Tha’laba ibn Hatib and make us people who jump at the opportunity to pay Zakat, and to strive fi sabilillah with our wealth and ourselves, and by that gain the garden and be exempted from the hell-fire. Amin
Filed under: Blogroll, Education, Money & Finance, Zakat | 1 Comment »
The following news item is quoyed from the Chatity Finance website and their is also a linked blog post by Vibeka Mair. I thought it was important for Muslims to see that this is shocking and unprecedented behaviour, surprising even to those like myself who have been long involved in the charity sector
Trustees of the UK-based Palestinian charity Interpal met representatives from the Treasury last month to protest about Lloyds TSB’s move to cut off the charity’s bank account. The trustees met Lord Myners, financial services secretary to the Treasury, at their request to complain about the fact that Lloyds TSB has stopped clearing Interpal’s cheques presented through the charity’s bank, the Islamic Bank of Britain.
A spokeswoman for the charity said the meeting did not bear any real fruit. “All levels of government know about the situation but still nothing is being done,” she said. However, she added that an interim solution had been found – the Islamic Bank of Britain has been able to transfer funds overseas for Interpal via other means. “They found a way to work around the service that Lloyd’s had been providing. We know this has been successful because we have spoken to people on the ground in Palestine.” However, Interpal still needed a long-term solution to the problem.
A spokesman for the Treasury said the government wasn’t getting involved “at this stage”. “At the moment it is just a commercial matter for the bank,” the spokesman said. However, he added that “not everyone that asks for a meeting with a minister gets one”.
Elsewhere, Barclays Bank has decided to close the account of humanitarian charity Ummah Welfare Trust (UWT), an Islamic charity which works in 20 countries worldwide including Afghanistan, Palestine and Pakistan. Barclays Bank has refused to give the charity a specific reason. UWT director Mohammed Ahmed said Barclays simply told him “it’s because of risk exposure.”
However, Ahmed added that the Charity Commission, who has met with UWT (pictured) to discuss Barclays’ decision, told him it would request a reason from the bank on the charity’s behalf. UWT, which gets much of its income from regular givers, will now face extra costs to tell donors to change the details of their direct debits or standing order.
The charity also fears it will lose donors who will not want the hassle of setting up a new standing order.
Dangerous precedent Barclays added an extra 21 days to UWT’s original 30-day notice on the account closure after the charity complained that it didn’t have sufficient time to deal with all of its direct debits and standing orders. Ahmed, however, believes the charity still does not have adequate time.nUWT is now looking at its options and considering a campaign.“This decision sets a dangerous precedent of disrupting British charities without any substantiation,” said Ahmed. “This decision will not only affect the great work carried out by UWT but will affect millions of people who rely on UWT.”
It might be quite timely to read our previous post “Alhamdulillah for Lloyds TSB“
Filed under: Leadership, Money & Finance | 3 Comments »
Bismillah: A few years ago I was appointed as the Amir of my community which, by Allah, gave me the opportunity to try and implement something I had been speaking about, and indeed writing about for some time, the proper collection and distribution of Zakat on Monetary Wealth using Islamic Gold Dinars and Islamic Silver Dirhams.
The first task was to appoint and then train Zakat Assessors and Collectors, which meant people of good standing in the community who were able to comprehend the deep significance of what we were doing and learn enough to be able to help people work out what they owed. It is important not to over-complicate things by insisting that Amirs and ‘people of good character’ are somehow these people who have never made a mistake or that they be replicas of the Khulafa Rashidun.
This was followed by having made sure that somebody in the community had seriously taken on being a supplier (and redeemer) of gold and silver coins (the Wakil), and then an education programme aimed at men, women, young people and children making sure that the assessors and collectors were known, and that everyone knew their individual responsibility concerning this pivotal Pillar of the Deen.
In my own role I was very particular about not being a collector or distributor but being an integral part of a team that looked at who might be the recipients of this Zakat which we needed to distribute as soon as possible after collection, and of course the ultimate responsibility of it all lay with me at that time, as the Amir.
Some time later when I was no longer the man in charge I was very pleased to see that the practice continued and people were readily coming forward to pay Zakat without prompting, and I even found myself having to help distribute the Zakat (in gold) to a man who’s house had recently burnt down, and now this year I find myself, by default, in the position of actually being a collector of Zakat.
I recognise, and am extremely grateful, for the privilege, honour and the great blessing that I have been afforded by Allah, to be so involved in the (re) establishment of a Pillar of the Deen in its correct form as best as we are able, meaning:
• Collection under Muslim Authority
• Zakat paid and distributed in Gold Dinars and Silver Dirhams
• Zakat paid to local people in the categories outlined in the Qur’an
Now, as the banking system collapses around us, are some Muslims beginning to wake up. Forget the ‘Muslim Banks” (may Allah forgive me using the two terms together) they will thankfully crash along with the rest of them and perhaps the “ulema” who have sanctioned such a thing will make a tawba that is accepted by Allah, they certainly need to. This is not being overly harsh on these people, but look at the difference. A handful of people striving to establish Allah’s deen by putting in place the fallen Pillar of Zakat in their local situation, against all the odds, with little resources and with much skepticism around them, and with a success that can only come from Allah. Compare that to some respected ulema, with the whole banking infrastructure behind them, lots of money, and the ear of the Muslim masses, yet the end result is that they direct these Muslim to Riba (usury), something that Allah and His Messenger have declared war on.
If Allah has made something halal then it must be possible, much less if He has made something Fard. It’s time for us to get our act together, to make it clear what Muslims and the Deen of Islam, has to offer to this crumbling society in terms of justice, social cohesion, wealth creation and social welfare, but we have to take it on ourselves, within our homes, within our communities and within our hearts and also under local Muslim authority and with a high himma relying on Allah, because success is only by Allah.
May Allah grant us success.
Amin, Amin, Amin.
Filed under: Education, Gold Dinar, Leadership, Zakat | 1 Comment »
On the authority of Abu Harayrah (may Allah be pleased with him), who said that the Prophet (peace be upon him) said: Allah the Almighty said: I am as My servant thinks I am. I am with him when he makes mention of Me. If he makes mention of Me to himself, I make mention of him to Myself; and if he makes mention of Me in an assembly, I make mention of him in an assembly better than it. And if he draws near to Me an arm’s length, I draw near to him a fathom’s length. And if he comes to Me walking, I go to him running.
It was related by al-Buhkari (also by Muslim, at-Tirmidhi and Ibn-Majah).
It was recently related to me a story about the some Ulema always coming to a particular Zawiyya in Morocco every Ramadhan, and every year repeating the same discourses about wudu. The fact was that no matter how often you heard it you could get something new every time, and thus improve your performance of wudu which would in turn impact on your prayer. Similarly we are all quite used to hearing discourses and khutbahs about fasting as the month approaches, which we are all no doubt grateful for, as many of our questions get answered.
However, despite Zakat being Fard and one of the “five pillars.” it is still rare to hear any regular attention being paid to looking in depth at the fiqh of Zakat and how to go about implementing it in a manner that will be the most pleasing to Allah
For example, when we decide we want to be serious about the pillar of Sawm (fasting in Ramadhan) we follow a clear course of action:
1. First we study the fiqh of Fasting in Ramadhan
2. We find out it is completely different from other fasts
3. We see and accept the command to begin “when you see the moon”
4. We accept that this means a confirmed sighting a ‘geographically relevant’ location
5. We accept that someone in position of authority (such as Amir) must make the final decision
Now we are in a position to easily refute or dismiss those who:
a) want to begin ramadhan based on calculation rather than a physical sighting of the moon and thereby ignore a Qur’anic command and a confirmed sunnah;
b) those who for some strange reason feel we must be compelled to follow Saudi Arabia.
We can, and must, only unite around what is correct. Therefore we are forced to take on some additional education and actions that will enable us to implement what we have learned from the fiqh, namely:
1. Recognising and anticipating the different phases of the moon, what to look for and where to look for it.
2. The appointment and acceptance of Muslim leadership at a local level (amirate) and ultimately at national level.
Likewise, when dealing with the pillar of Zakat we must first go the fiqh, and we will discover that:
1. Zakat needs to be collected by an individual Muslim leader or those he appoints in his place;
2. Zakat on wealth must be valued in Islamic Gold Dinars (IGD);
3. Zakat must be paid and distributed “in-kind” which in the case of ‘wealth’ means in Gold dinars or their equivalent;
4. Zakat must be distributed locally;
5. Only when there are No Muslim in need locally can it go further afield, and even then starting with the next town as opposed to going abroad;
6. What many people give to Islamic charities would fall under the category of sadaqa and not the fulfilment of the Pillar of Zakat;
7. Zakat-al-Fitr is NOT the Pillar of Zakat.
As with the case of Ramadhan we can now confidently dismiss certain positions such as:
• the validity of islamic charities collecting Zakat;
• the practice of automatically sending “zakat” abroad;
• the assumption that UK Muslims don’t need Zakat;
• the presumption that it is generally “OK” to pay your Zakat to family members ;
• that it’s absolutely fine to let things continue as they are.
Allah says in Surah Tawba that ther are eight categories of people to whom the collected zakat must be distributed by the leader of the Muslims:
“Collected sadaqa is for: the poor, the destitute, those who collect it, reconciling people’s hearts, freeing slaves, those in debt, spending in the way of Allah, and travellers.” (9:60)
So now we are left with no choice but to take on at least these three main courses of action:
1. Concerning the islamic Gold Dinar & Silver dirham, we have an obligation to know their specifications and their value, to make them available for Muslims, whether solely for Zakat purposes, savings, abandoning riba or for dowry, and to make it easy for the recipients of Zakat to spend or redeem these dinars.
2. The implementation or acceptance of leadership on a local level for distributing Zakat locally and thus knowing who are the local worthy recipients who fit the specific categories.
3. The appointment and training of Zakat assessors and collectors
May Allah show us the truth as truth and make us follow it, and the false as false and make us avoid it.
Amin
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I have felt compelled to write this short note to ensure that we understand the implications of the extra-ordinary events which occurred this week. Basically in the UK we are witnessing a run on a bank, Northern Rock customers have lost confidence in the bank and everyone wants their money. With all the talk of sub-prime and financial journalism speak I’d like to ensure that we are all aware of what is occurring.
Our economies in West have become remarkably unproductive industrially and agriculturally. We simply cannot compete with the cheaper labour and cost of resources of the emergent economies – so that industrial production has migrated to the emergent economies especially China, India and the other Eastern economies. This has left us no alternative but to expand our service industries but we have found stiff competition in this sector from some of the emergent countries as they have sought to move into higher profit margin activities. With their lower costs they are seeing strong economic growth based on the strong fundamentals of industrial growth, agricultural growth and the application of new technologies. By comparison we in the UK and similar countries, are seeing the continual shrinking of our industrial sectors and the growing inability of our agricultural sector to compete in the global market. Increasingly our capital has been moving into speculative financial instruments to leverage the considerable financial wealth we still possess. Western bankers have used this to maintain their stranglehold on the world economy, with financial instruments that become increasingly abstract and that place in question the stability of our already fundamentally flawed financial system. These instruments are very efficient at shunting money around the world economy but amount to a patient pumping himself full of adrenaline, whilst he bleeds, to increase his heart rate. The more the heart rate rises, the more blood he loses and the more the blood loss is the greater the attempt of the heart to pump blood around the body. Eventually the patient loses so much blood that life is no longer viable and the heart stops.
The attempts to stabilise the condition of our economies whilst we bled, due to our inability to maintain our position as primary producers and market controllers, has led to the growth of the speculative financial markets in order to ensure that the worlds largest consumer markets (ourselves) kept buying so that we could maintain one of our strongest bargaining chips (our provision of the largest and richest consumer market in the world). This has been centred around encouraging us to invest in speculative financial instruments such as stocks, equity funds, bond markets, etc. However, in order to ensure that we are able to continue to do so in ever larger numbers so that we keep our consumer market the largest and most desirable in the world, we have been encouraged and seduced into an over valued real-estate market. Cheap credit has allowed us to buy immensely over valued property and spend based on borrowing via the equity created by the ever inflating prices. Since there are very little activities that bring in the profit margins as real estate (of course that is if you are not one of those most savvy investors who understands how to play the markets) much of that money has been re-invested into the property markets driving prices up and allowing the investor to borrow even more money to reinvest in property, which itself drives the prices up even more as we rush like lemmings to the cliff’s edge of financial economic meltdown.
Our governments upon seeing what has been occurring have slavishly served their financial masters and compounded the effects of the impending disaster. They have ensured that they have stabilised the conditions which allow such borrowing to continue by ensuring that the conditions exist to allow banks to continue to lend and maintain the burgeoning bubble. When the talk was of 25 year fixed rate mortgages we knew that the writing was on the wall, the drive was to get everyone and his mother on the credit treadmill. Two to three months ago a dear friend of mine asked me to get involved in the real estate market with him, when I investigated the market and discovered that the probable rental yields on mortgaged properties were almost equivalent to the mortgage repayments. This indicated that the market was approaching saturation. The bubble was hitting bursting point and the lemmings were rushing for the cliff face – needless to say I advised him against remaining involved in the real estate market. I also invited him to get involved in gold – but more about that later.
I said that this would be short and I’ll keep it so, what has happened is that the mortgage lenders have taken risks on borrowers in precarious economies, they were encouraged to do so, some of them were overzealous. This has increased the velocity of the bubbles growth and it has approached the point at which it is in danger of bursting. The bankers now believe that the patient has had enough adrenaline so they are voting with their feet. They know the dangers involved, we’ve seen it enough times before – the market has approached collapse point and now no one wants to lend to the mortgage lenders on the front line. Where will people get the money to continue paying their debts if the economy does not become fundamentally productive? What are we selling to the Chinese, the Indians and the other emerging consumer markets?
My advice is buy gold and silver. Gold and silver are commodities, they have historically been money and will always hold their value (even gain value in difficult economic times). As instability has reared its head in the world economy we’ve seen sharp gains in their commodity prices, because they have always been money and a store of wealth. We have lived through an interregnum which has seen the rise of monetarism (which is the control of the economy by the manipulation of monetised tokens), for the first time historically gold and silver were not money, commodities were not money. That interregnum is ending and gold and silver are returning to their natural place after the disastrous watch of the monetarists. Basically gold and silver are natural money and since it is a widespread commodity once it is widely distributed in your hands its very hard to manipulate. In the current circumstances take refuge in gold and silver. If you’re in the EU buy gold but if you can take delivery of silver outside the EU then take it you’ll protect your wealth and see a greater gain in your net worth but you need a wise portfolio to survive the coming storms. Insha-Allah I’ll be explaining some of this in coming articles.
Be careful Northern Rock is the beginning of a terrible time that’s been swiftly approaching for a very long time.
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Anyone with a basic knowledge of the fiqh of Zakat will know that the three categories of wealth that Zakat is payable on are (1) Agricultural Produce (2) Livestock, and (3) Monetary Wealth.
This monetary wealth (Ayn) is often called ‘hidden wealth’ in that unlike the other two it is not easily open to scrutiny and thus the person assessing/collecting the Zakat must rely on the knowledge and integrity of the person being assessed in order to come to a correct conclusion on the amount to to be paid/collected.
Many people will have dowloaded the Zakat Assessment Form from this site. However, it must be noted that this form is only a tool to help individuals list and sort out the relevant items that may effect their Zakat. In other words it is designed so that one can clearly lay out and show the assessors/collectors what needs to be taken into account for them to come to a decision.
So the assessment must be connected to a local Muslm leader who has instructed and authorised assessors/collectors and who has declared his intention to distribute it locally and to people in the correct categories. Also where possible this should be connected to making it possible to not only assess, but also collect and distribute the Zakat in Islamic Gold Dinars or Silver Dirhams. So in other words the Zakat Assessment Form is not an excuse for a self-assessment/do-it-yourself approach to Zakat, although one realises that in some instances the assessor may be perfectly happy to rely more upon some individuals own calculations because of their knowledge of the issue, honesty and integrity.
In recent years certain communities here in The UK have taken Ramadhan as a time to make a big push on the issue of Zakat as this is a time when more Muslims gather together in order to concentrate on acts of Ibada. In particular there are communities in the Midlands, East Anglia, Scotland and London. In all these places there are also suppliers of Gold Dinars and Silver Dirhams.
We will, Insha Allah, shortly publish a list of leaders and communities worldwide who are re-establishing the fallen Pillar of Zakat and of those suppliers of Dinars and Dirhams who are aiding them in the process. Information can be sent to zakat@zakatpages.com
May Allah grant us success.
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BISMILLAH
As we exit the sacred month of Rajab and head through Shaban into Ramadhan, it is the coming Ramadhan that dominates many of our thoughts. Yet Rajab is one of the four sacred months in which we have to take special care and attention in many of the things we do, including getting into or continuing a conflict.
How can it be that very few of us can name the other sacred months, much less be aware of when they occur? What about the other special times that Allah, by His Mercy, has put in the year for us, or in each week, and also in each day and night.
I recall recently buying a bottle of sparkling drink from a supermarket only to be told by the cashier that they were on a special “two for one offer.” I naturally ran back to get my other “free” bottle, who wouldn’t? Yet Allah is always giving us these “special offers,” the prayer of the Jamat at the Mosque being better than praying alone, the time before fajr, the time before Jumuah, Mondays and Thursdays, the Doha time, the sacred months, Ramadhan, the Night of Power itself and no doubt much more.
Making the most of the special times along with establishing what we must of the five pillars is no easy task, but how can we aim for anything less than that? By this I mean establishing an educational process that spells out the true meaning of the Shahada and correct Tawhid. I mean establishing the prayer in the correct place and being properly led. This means establishing the proper collection of the Zakat with its necessary leadership, the use of gold and silver and with it being distributed in the locality it was collected. This also means beginning Ramadhan according to an actual physical sighting of the new moon authorised by a legitimate local Muslim leader, and similarly the correct preparation and observance of both the Hajj and the Eid ul Adha.
From Abu Hurairah, may Allah be pleased with him, there is that he said, “The Messenger of Allah, may Allah bless with him and grant him peace, said, ‘Allah ta’ala said, “Whoever shows enmity to a close friend of Mine, then I declare war on him. My slave does not draw closer to Me with anything more beloved to Me than that which I have made obligatory upon him. My slave continues to draw closer with optional extra acts until I love him. When I love him, I am his hearing with which he hears, his sight with which he sees, his hand with which he grasps and his foot with which he walks. If he asks Me I will definitely give him, and if he seeks refuge with Me I will definitely give him refuge”.’ ” Al-Bukhari narrated it.
What is there that we can we prioritise above these things? These things have to dominate our political activities, our social aspirations and our views on education. These things must must be heard from the Mimbar, thay must be heard in the teaching circles, they must be heard on Radio Ramadhan and on these “Islamic” TV stations.
Fundamentalists - Which of these fundamental principles of Islam that we have mentioned are they striving to establish?
Extremist – Extremely off the mark, when they turn something haram (suicide) into something desirable and when they either ignore, or are not aware of, the rules of Jihad.
So these so called fundamentalists/extremists have, unfortunately for them, not had the benefof being educated in the way that has just been outlined in terms of how the Deen is established and about doing the things that Allah Himself indicates please Him.
This however, is not to fall into that trap of espousing an islam has decribed by Bush/Blair(Brown), a nice cuddly Islam with no teeth and that seeks political favour from these lowest of the low politicians. This is not to fall into that common mistake of saying the word “Islam” itself means peace, when in fact it means submission.
We must be those who KNOW that whatever Allah has made halal is possible.
From Ibn ‘Umar, may Allah be pleased with both of them, that he said, “The Messenger of Allah, may Allah bless with him and grant him peace, took hold of my shoulder and said, ‘Be in the world as if you were a stranger or someone traversing a way’.” And Ibn ‘Umar, may Allah be pleased with both of them, used to say, “When you enter upon the evening, do not expect the morning, and when you get up in the morning, do not await the evening, and take from your health for your sickness, and from your life for your death.” Al-Bukhari narrated it.
So in our preparations for the month of fasting, let us ask Allah to make it a month when we examine these issues in detail. A time when we look in depth at the education of ourselves and our children. Let it be a time when we decide never again to abandon the Sunnah in the way we confirm and enter the beginning of Ramadhan. Let it be a time when we re-examine the pillar of Zakat and make a commitment to see it restored in all its glory. And we ask Allah to make it a time when we earnestly seek and find the Laylat ul Qadr.
May Allah grant us success, Amin
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BIsmillah
I listened to a khutbah today where the imam spoke about envy. The third type of envy he mentioned was where you see someone with something and you would like the same for yourself but you also want them to keep what they have. This is an acceptable form of envy whether it be for a car or some upright behaviour you see in that person. Another type of envy he mentioned was when you desire that good thing to leave the other person in a spiteful way, whether the benefit comes to you or not. Now this is haram completely unacceptable.
I mention this because I have noticed that since the labour government came to power in Britain ten years ago they seem to have been obsessed with destroying everything that I would of thought were the best things about Britain. This was particularly noticeable when it came to the ban on fox hunting. Was that not simply jealousy of the fact that this was a lifestyle they had no entry into? Is this where they started to feel inadequate? Did they feel that the remnants of the British aristocratic class were behind their back laughing at them and calling them peasant upstarts?
Of course later on they realised ‘horror of horrors’ that people from the Caribbean, the Indian Subcontinent, Africa and elsewhere are also very class conscious themselves and none moreso than the Muslims.
“We love you Mr Blair, but there is no denying you are still a kafir.”
They say they don’t believe, but it still bothers them greatly that here is another club they can’t get into. So what do they do? They can mock religion in general, but too many of them are professed christians of some sort. Then they realise that despite their publicised differences there is actually much to much that the Muslims actually agree on.
“Put up our own ‘Muslim’ spokesman that should do the trick,”
but as soon as they open there mouth they lose credibility with the Muslims,
“we need a direct attack, we need to provoke them.”
Jack Straw obliges. A big man, supposedly one of the most powerful men in the country, feels he cannot effectively have a conversation with a female Muslim constituent if he can’t see her face. No point phoning him then.
“That’ll stir up the barbarian hordes” (See: Lifting the Veil on the Veil Issue)
But more importantly it might make it open season on Muslim women.
“That’ll teach those Muslims for daring to vote in George Galloway in East London and embarrassing the labour party”
Not content with turning the whole justice system on its head, sanctioning torture, instigating war and creating a climate of fear, the outgoing leader decides he must give a final kick in the teeth to the British Muslim population with the knighthood of this criminal author. The poor souls in these literary and artistic circles, now have to defend this man they don’t really like all over again in order to prove their liberal credentials. As usual these liberals insist we be free to express our views, except of course when our views are that:
“you are talking absolute nonsense, your behaviour is filthy and disgusting, you’re a kafir and if you don’t change your ways you’ll probably end up in hell”
They hate that! We’re not playing the game, so now their precious liberal values go straight out the window.
Isn’t it absolutely clear. Does a study of history not show us that often times, particularly in Africa and the Indian Subcontinent that it was so often the nobles, the ruling classes, the educated classes that first embraced Islam because they could see it confirmed what they knew of noble character and acceptable social behaviour. Was it not the upstanding behaviour of the Muslim traders that had a first and lasting impact on many people? (not to deny the impact of the warrior).
We Muslims have to regain our nobility. This means establishing what is fard and avoiding what is haram. This means establishing, according to the Sunnah, the pillar of Zakat in all its glory including the necessary leadership, gold & silver, identifying local recipients and distributing it accordingly (view related article). Coupled with that we must take steps to have halal business contracts and to avoid riba/usury in all its guises.
If we do this then what is left of the aristocracy, the best of the self-made wealthy businessmen, graduates from the top schools, the dynamic community activists will all have no choice but to get together with our African (North, East & West), Caribbean, Pakistani, Bangladeshi, Turkish and Arab Muslims brothers and sisters in order to make Britain truly ‘Great Britain.’
In the meantime we cannot continue to be made fools of. We have to see what is happening. We must begin to really consider if we as Muslims can justify taking part in the democratic process where sometimes less than 20% (one fifth) of those even registered to vote actually bother. It would definitely be shameful and a travesty of logic should any Muslim vote for the labour party given their awful record of the last ten years, unless it forms part of some clearly legitimately Muslim led and defined strategic process that would have a clear benefit locally or nationally.
So our rallying cry must be “Zakat, Zakat, Zakat”
May Allah grant us success, Amin
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The Consultant’s View – Articles & Audio Files
