The Role of Zakat in Achieving Financial Sufficiency for the Individual and Society

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Islam & Life

The fundamental principle in Islam is that every individual should work to secure a sufficient livelihood for themselves and their dependents. However, if a person exhausts their capabilities and is unable to provide for their needs, then Zakat becomes the primary resource for providing this basic sufficiency—indeed, its completeness—for every individual in the Muslim community.

Zakat is considered the first, most complete, and most comprehensive system in the world, even to this day, for meeting all the essential needs of individuals, allowing them a good and dignified life.

The great role of Zakat in achieving financial sufficiency is evident in the following points:

Firstly: The Primary Objective of Zakat Legislation is to Achieve Financial Sufficiency:

Anyone who contemplates the legislations and rulings of Zakat will clearly realize that the main objective behind these laws and rulings is to achieve financial sufficiency for the individual and society. The evidence for this is abundant, including the following:

1. The Broad Scope and Multiple Sources of Zakat:

Allah Almighty has designated all types of wealth as subjects for Zakat, making them its receptacle, without exempting any kind. Thus, Zakat is levied on currency, trade goods, crops and fruits, livestock, minerals, buried treasures, and marine wealth.

Undoubtedly, this breadth and abundance in Zakat's resources are conducive to providing most of the requirements of the poor and needy, achieving full sufficiency for them, and raising their standard of living.

2. The Amount of Zakat Represents a Substantial Sum:

Zakat, when viewed in terms of the entire nation, is not a trivial or meager amount. It is estimated at one-tenth (10%) or half of one-tenth (5%) of all agricultural produce, whether edible or not—according to the most authentic opinions—based on the generality of Allah's saying: "And from what We have produced for you from the earth" (Al-Baqarah: 267).

In our modern era, the income from buildings, factories, land and sea transportation companies, and similar "investments" that generate regular income and constitute large capitals for a number of people can be analogized to agricultural lands.

Zakat is also one-tenth (10%) of the produce of honey, as supported by narrations and logical consideration. This can be analogized to animal products in our era, such as silkworm products, poultry farms, dairy cows, and so on.

Zakat is also one-fourth of one-tenth (2.5%) of the nation's cash and commercial capital. It is approximately this amount from livestock kept for milk and breeding, such as camels, cattle, and sheep, provided they reach the nisab (minimum taxable amount) and graze for most of the year in permissible pastures, contrary to Imam Malik, who made Zakat obligatory on livestock even if its owner feeds it all year. Some Companions and Successors made Zakat obligatory on horses kept for breeding, which is the madhhab of Abu Hanifa. For discovered treasures from ancient relics, it is one-fifth (20%), and similarly for mineral wealth, according to verified jurists.

Zakat is a periodic obligation that is collected every hawl (lunar year) from money, trade, and livestock, and with every harvest of crops and dates. It is also a general obligation in which the vast majority of the nation participates, with only those with limited incomes who have not reached the legal nisab being exempt (1).

There is no doubt that paying this amount in full and undiminished will work to improve the conditions of the deserving, moving them from a state of need to abundance and complete sufficiency.

3. Locality of Zakat:

The meaning of the locality of Zakat is that the principle is for it to be distributed in the place and area from which it was collected. Zakat is gathered from the wealthy of a town and must be spent within that same town. If the collector (the sa'i) makes a mistake and transports the Zakat from one town to another where its people are in need, the Imam must return it to them, as Umar ibn Abd al-Aziz did and as Sa'id ibn Jubayr ruled (2).

This is clear evidence that the purpose of Zakat is to achieve the sufficiency of the people of the town from which it is taken, and to meet their needs first. Allah Almighty has ordained it in a way that suffices them from needing financial assistance from outside their town.

Imam Abu Ubaid said: "The scholars today are in agreement that the people of every town or water source are more entitled to their Zakat as long as there is at least one needy person among them, even if it consumes all of their Zakat, until the collector returns with nothing" (3).

The basis for this is the Prophet's (peace be upon him) saying to Muadh when he sent him to Yemen to invite them to Islam and prayer: "You are going to a people from the People of the Book. Let the first thing you invite them to be to affirm the oneness of Allah. If they acknowledge that, then inform them that Allah has obligated upon them five prayers in their day and night. If they pray, then inform them that Allah has obligated upon them Zakat from their wealth, to be taken from their rich and returned to their poor" (4).

4. Zakat is Only Taken from Wealth Exceeding Basic Needs:

This is a condition mentioned by jurists for wealth on which Zakat is obligatory: that the nisab must exceed the owner's basic needs, which are essential necessities like food, clothing, transportation, and tools for one's profession (5).

The Holy Quran has stipulated that spending wealth should be from what is surplus to basic needs, as stated in Allah's saying: "And they ask you what they should spend. Say: 'The surplus'" (Al-Baqarah: 219). And 'the surplus,' as Abdullah ibn Abbas said, is "what is left over after providing for your family" (6). This condition allows the Zakat payer to achieve a decent standard of living by exempting a suitable amount of their income to meet their basic needs.

5. Diversity of Its Disbursements:

One who reflects on the eight categories of Zakat recipients will see that they are diverse and numerous, encompassing all groups with needs and categories deserving of assistance.

The Sharia made the poor and the needy the first categories to whom Zakat is disbursed. This is an indication that the primary goal of Zakat is to combat poverty in the Muslim society and to provide sufficiency for every individual within it.

A share of Zakat was also allocated as material and moral compensation for those who embraced Islam and often sacrificed family and wealth for its sake, or those whose conversion to Islam is hoped for and who might fear poverty or need upon entering Islam, or those who support Islam and are given assistance for their stance. This is the share for "those whose hearts are to be reconciled."

Furthermore, a portion of Zakat is allocated for a Muslim who faces an emergency economic crisis that depletes their wealth, leading to debt or cutting them off from their money due to travel. Islam also dedicates a share of Zakat funds for emancipation and freeing slaves, to fulfill a deeply desired psychological need for the enslaved Muslim: the feeling of freedom.

As for the share "in the way of Allah," it is given to the soldiers striving in the way of Allah for their sufficiency and what they need of provisions and military equipment. It is also given to scholars and preachers for their expenses and books, because their struggle with the pen and tongue is no less significant than the soldiers' struggle with the sword and spear in supporting and defending Islam, strengthening the pillars of society, consolidating its creed, and raising its banner.

6. Deferring Zakat When Necessary:

The economy may face exceptional circumstances that could lead to the destruction of people and wealth, and a decline in the standard of living below the level of sufficiency. This would necessitate easing the burden on individuals by deferring their obligatory Zakat payment.

Similarly, the punishment for theft is suspended until every individual has access to their share of basic necessities, and providing a sufficient livelihood becomes a priority that must be achieved so that one of the hudud (fixed penalties) is not suspended due to its absence (7).

This is what Umar al-Faruq (may Allah be pleased with him) did. It is reported from Abu Dhubab that Umar postponed the collection of sadaqah (Zakat) during the Year of the Ash (8). He said: "When the people recovered (and it rained), he sent me and said: 'Bind two ligatures on them, divide one ligature (the Zakat of that year), and bring me the other'" (9).

And from Abu Ubaid that Umar delayed the collection of sadaqah from them that year; he did not take it from them until they recovered. And such was his foresight that he even suspended the cutting of the hand for a thief in such a year, saying: "There is no cutting in a year of hardship" (10).

This means that if the Imam sees it beneficial to postpone the collection of Zakat in a year of drought, he may delay it until a year of abundance, and then collect it from them in full in the following year.

Thus, it is clear from all the above that the rulings and legislations of Zakat primarily aim to achieve financial sufficiency for the entire society.

To be continued...

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 Footnotes:

(1) See: The Problem of Poverty and How Islam Addressed It, Dr. Al-Qaradawi, p. 61. See also: The Role of Values and Ethics in Islamic Economics, p. 407.

(2) Ibid., p. 712.

(3) Ibid., pp. 709-710.

(4) Narrated by Imam Al-Bukhari in his Sahih, Book (Tawheed), Chapter (What came concerning the Prophet's ﷺ call to his nation to monotheism of Allah, the Blessed and Exalted), Vol. 6, p. 2685, Hadith no. (6937).

(5) Fiqh Al-Sunnah, Sheikh Sayyid Sabiq, Vol. 1, p. 334.

(6) Tafsir Al-Quran Al-Azeem, Ibn Kathir, Vol. 1, p. 256.

(7) Zakat: Sharia Foundations and Its Developmental and Distributive Role, Dr. Ni'mat Mashhour, p. 399.

(8) Al-Ramadah: In the twelfth year of the Hijra, during which people and wealth perished.

(9) Al-Amwal, Abu Ubaid, p. 464.

(10) Ibid., pp. 669-670.