The obligation known as zakāt constitutes one of the five pillars of Islam, the others being the shahādah (declaration of faith), prayer, fasting, and the pilgrimage to Mecca (ḥajj). Muslims with the financial means to do so are obliged to give a certain percentage of their wealth (2.5 percent or one-fortieth of net worth, deducted annually) as zakāt. It must be paid by those believers who have possessed for one year the minimum limit (niṣāb) or more of money or trade goods—generally defined as 20 dinars (85 grams of gold), 200 dirhams (595 grams of silver), 5 camels, 30 cows, 40 sheep, or equivalent amounts of other commodities. Zakāt was institutionalized as an obligatory edict of faith in both the Qurʿān and the traditions of the Prophet. The method by which an individual calculates his or her dues is outlined in several ḥadīth reports. To practicing Muslims, zakāt is more than a mere financial transaction. It connotes the path toward purity, the comprehension of material responsibility, and an enhanced sense of spirituality.
The concept of zakāt defies simple definition. Although it has commonly been defined as a form of charity, almsgiving, donation, or contribution, it differs from these activities primarily in that the latter are arbitrary, voluntary actions. Zakāt, by contrast, is a formal duty not subject to choice. It compels believers to disburse a specific amount of their wealth, and it conditions their identity as Muslims on their willingness to adhere to this fundamental precept of Islam. In form it is a tax on accumulated wealth, not to be confused with alms or charity in general or a tax on income.
The Qurʿānic verses admonishing the faithful to impart portions of their wealth to the needy were revealed to the prophet Muḥammad during his years in Mecca. They urged Muslims to utilize their wealth for the assistance of the poor, the needy, and relatives: “That which you lay out for increase through the property of other people will have no increase with God; but that which you lay out for beneficence (zakāt), seeking the countenance of God [will increase]. It is these who will attain a recompense multiplied” (30:39). This parallels earlier Semitic uses of similar terms to describe a payment due on property that serves to purify it and hence cause it to be blessed and multiply. Verse 9:103 seems originally to have referred to a payment that caused sinners to be purified.
It was in the Prophet's ḥadīth, however, that zakāt was formalized as an obligatory component of Islam's foundations:
"On the authority of Abū ʿAbd al-Raḥmān ʿAbd Allāh, the son of ʿUmar ibn al-Khaṭṭāb, who said: “I heard the Messenger of Allāh say: Islam has been built on five pillars: testifying that there is no god but God and that Muḥammad is His Messenger, performing prayers, paying zakāt, making the pilgrimage to the House [i.e., the Kaʿbah in Mecca], and fasting in Ramadan” (Nawawī, p. 34)."
Despite being a mandatory act of worship, zakāt was not gathered or distributed via formal institutions during the early Meccan period because Muslims were still relatively few in number and lived in a society hostile to their beliefs. Muslims gave their zakāt privately to assist the poor and to buy the freedom of those in slavery. Yūsuf al-Qaraḍāwī, a modern scholar of Islamic law, writes: “The practice [of zakāt] in Mecca was general, without specificity or rules. It was left to the individual's conscience or his [sense of] hospitality and the feeling of duty towards [fellow] believers” (p. 61).
Following the Prophet's flight to Medina, he received this revelation: “And be steadfast in prayer and regular beneficence (zakāt); and whatever good you send forth for your souls before you, you shall find it with God: For God sees well all that you do” (2:110). Unlike the earlier Qurʿānic reference, the task of zakāt is here expressed as a command, not merely advice.
Further testimony to zakāt's prominence in Islam became evident when the Prophet dispatched numerous companions to invite tribal leaders to submit themselves to God:
"On the authority of Ibn ʿAbbās, the Prophet sent Muʿādh to Yemen, saying: “Invite the people to testify that none has the right to be worshipped but God, and I am His apostle; and if they submit themselves, then teach them that God has enjoined on them five prayers during each day and night. And if they submit to this, then tell them that God has made it obligatory for them to pay zakāt from their property; it is to be taken from the wealthy among them and given to the poor (Sahīh al-Bukhārī, pp. 271–272)."
By the hijrah's second year, the Prophet had defined the basic rules, the forms of wealth covered, and who should pay and receive zakāt. Thus zakāt had evolved from a voluntary practice to an institutionalized socioreligious duty expected of each Muslim who possessed the niṣāb, the minimum amount of wealth that may be subject to zakāt. Ibn Kathīr (d. 1373), a noted Islamic scholar, stated, “Zakāt was established in Medina during the second year of the hijrah. Apparently the zakāt established in Medina was one with specific values and amounts due, while the initial zakāt discussed in Mecca was merely a [personal] duty.”
Al-Qaraḍāwī, a twentieth-century Islamic jurist, concurs:
"The Muslims in Mecca were helpless individuals [unable to carry] their mission to others. Muslims in Medina, however, comprised a social majority owning land and property, as well as holding positions of power. The Islamic obligation [of zakāt] took on a new form to accommodate this new reality. Zakāt became specific… and legally binding…. The Medinan approach included legal institutions, predetermined percentages of wealth due…, the values and quantities that are “zakāt-able,” eligible beneficiaries, and the state-run institutions empowered to administer, collect, and distribute zakāt” (p. 62)."
In fact, neglecting to pay zakāt became an offense punishable by law. This was a precedent set by the first caliph, Abū Bakr, who fought against those who refused to fulfill their obligation of zakāt. Zakāt in this case, however, was in essence a form of tribute paid by the tribes of the Arabian Peninsula to the Muslim treasury (bayt al-māl). Failure to make these payments after the death of the Prophet Muḥammad resulted in the Wars of Apostasy during Abū Bakr's caliphate (632–634).
Zakāt serves both a functional and a spiritual dimension. At a practical level, the system has three basic elements: the donors subject to zakāt, those eligible to receive it, and forms of “zakāt-able” wealth. Those subject to zakāt are the possessors of the niṣāb, the more affluent Muslims. Those eligible to receive zakāt are predominantly the poor. According to the Qurʿān they fall into eight categories: the destitute (al-fuqarāʿ), the needy (al-masākīn), the zakāt administrator (al-ʿāmilūn ʿalayhā), those receptive to Islam (al-muʿ allafa qulūbuhum), those who are in bondage (fī al-riqāb), debtors (al-gharīmūn), those in the way of God (fi sabīl Allāh, i.e., engaged in anything that enhances the religion), and the wayfarer (ibn al-sabīl). As these categories came to be interpreted in Sunnī law, five (the destitute, needy, slaves, debtors, and wayfarers) constituted the poor, and three constituted the government bureaucracy or military class (the zakāt administrator, those receptive to Islam, and those in the way of God). The primary forms of wealth subject to zakāt include gold, silver, livestock, agricultural produce, articles of trade, currency, shares and bonds, and other liquid assets.
According to Twelver Shīʿī law, the Imam and his agents are in charge of collecting and distributing zakāt. During the Occultation of the Twelfth Imam, however, the eleventh-century jurist al-Shaykh al-Ṭūsī (d. 1067) upheld the view that three categories of eligible recipients—the zakāt administrator, those receptive to Islam, and those in the way of God, understood as those who perform jihād—were no longer valid. In another text he allows that “those in the way of God” are still eligible recipients if they engage in acts such as building mosques or repairing bridges. However, by the sixteenth century, all these categories had been re-established as legitimate by Shīʿī jurists on the grounds that the jurists, as the general representatives of the Hidden Imam, had the right to collect and distribute zakāt.
Zakāt's spiritual dimension cannot be underestimated, particularly since it holds a great deal of psychological as well as material importance to Muslims. Those who give and receive zakāt are bound together through this mutual love encouraged by the distribution of wealth. Fulfilling one's duty regarding zakāt, conscious that a pillar of Islam is being satisfied, instills in the believer a sense of completion and purity. In addition, setting aside a portion of one's wealth for eleemosynary purposes challenges the individual to face the selfishness, greed, and lust for material possession inherent in human nature. The poor also benefit spiritually from this transaction.
Ideally, zakāt creates a balance of wealth, freeing the individual to concentrate on spiritual advancement rather than material gratification. The Qurʿān, elucidating this point, warns against the concentration of wealth in the hands of the few:
"What Allāh has bestowed on His Messenger (and taken away) from the people of the townships—belongs to Allāh—to His Messenger, and to the kindred and orphans, the needy and the wayfarer; in order that it may not (merely) make a circuit between the wealthy among you (59:7)."
Zakāt is an integral part of formal Islamic systems, affecting community development, society, and economy. By discouraging the hoarding of capital, zakāt stimulates investment. Since zakāt must be extracted from an individual's net wealth, whether or not the capital is utilized, Muslims are compelled to invest in productive ventures. As a result, the zakāt may be drawn from any profits, and channeling funds to investment will concomitantly prevent the erosion of the capital through zakāt deductions. Moreover, zakāt, according to Islamic scholars, does not include the means of production—equipment, factories, or tools—which provides an added incentive for investment. This exclusion of physical assets encourages trade and commerce, as opposed to such speculative investments as stocks, bonds, and other monetary-oriented transactions. Insofar as the disbursement of zakāt funds is concerned, it finances the consumption expenditure of the poorest groups in society. Zakāt constitutes a direct infusion of funds into a segment of society, increasing effective aggregate demand, that is, the ability of consumers to make viable transactions, with purchasing power. Eventually this leads to rising employment and output, and consequently to economic development. These contributions—based on both moral obligation and sound economic reasoning—play a major role in maintaining societal order and enhancing a cohesive social fabric among Muslims. Ideally, the productive bond created between the affluent and needy eliminates theft, vandalism, and other social ills. Zakāt is designed to build a cooperative environment throughout the community while directly combating feelings of resentment and rivalry.
Zakāt was formerly applied in all Muslim territories and respected as an Islamic obligation. Because the general populace viewed zakāt as a religious and moral duty, Muslim authorities had no problems in collecting it. With the advent of colonialism and the introduction of systems of government that excluded religious doctrine, authorities in most Muslim states largely abjured Islamic codes of law, including zakāt. As a result of the institutionalization of secular tax systems, zakāt has lost its once prominent position in Muslim life. In fact, writes al-Qaraḍāwī, “Were it not for the concern of some Muslim individuals and institutions, zakāt would have been completely eradicated from Muslim life” (p. 1115).
Despite the external and internal obstacles that hinder the application of sharīʿah (Islamic law) in the Muslim states, some states have begun to do so. Zakāt is now applied in Jordan, Saudi Arabia, Malaysia, Pakistan, Kuwait, Libya, Iran, and Sudan. Needless to say, these are recent efforts that are considered as the beginning of a long road toward the ideal zakāt application. Experiences in two countries, Sudan and Pakistan, may serve as examples.
After the period of Mahdist Islamic rule in Sudan (1885–1899), zakāt continued to be paid by individual Muslims on a personal basis, as there were no voluntary or official institutions to carry on the duty of collection and distribution of zakāt. In 1980, twenty-four years after Sudan's independence, a voluntary zakāt chamber was established. Muslims were encourage to pay their zakāt voluntarily to this chamber so that it could disburse the funds on their behalf. Such procedures continued for four years.
In 1984, for the first time since Mahdist rule, zakāt became an official compulsory Islamic duty based on government legislation. The government of Sudan issued the 1984 taxation and zakāt law, which combined both taxes and zakāt and established a zakāt and taxation institution. To apply this legislation the institution appealed to the experiences of Pakistan, Libya, Kuwait, Jordan, and Saudi Arabia. The zakāt chamber continued to collect and distribute the zakāt, which became a compulsory and official state duty. In 1986 a new zakāt law was enacted by which a separate zakāt chamber was established. This law was an outcome of the Islamic laws of 1983 that were issued by the state as an attempt to apply the sharīʿah in Sudan. The 1986 law defined two specific goals. First, the state rather than individuals should take over the responsibility of collecting and distributing zakāt. The law left part of the zakāt to the individual payers to distribute themselves. Second, regional zakāt offices were to be established to work in collecting and distributing zakāt in addition to the central chamber in Khartoum.
Under the Islamic National Salvation government that came to power in 1989, the zakāt system entered a new phase. Zakāt became one of the prime focuses of the new government as part of its overall objective of fully applying sharīʿah as the source of public law. Immediately the National Salvation government issued the Zakāt Law of 1990. This law built on the previous experience but also added a much larger vision to the role of zakāt in the new Islamic society that the government was seeking to create. The principal elements of the 1990 law are as follows:
- 1. Zakāt became applicable to anything that could be called wealth if it reaches the niṣāb (the minimum required value that is subject to zakāt).
- 2. The expenditure areas were extended to go beyond the needs of individuals to those of society at large and the state.
- 3. To emphasize the popular dimension, the higher council of zakāt trustees and lower councils of zakāt trustees across the capital and other regions were established, and popular committees that would help in distributing zakāt were formed.
- 4. The law expanded the source of zakāt to include, beside the compulsory resources, the acceptance of zakāt from institutions and individuals throughout the Muslim world, alms, grants from inside and outside Sudan, and the returns of investment of the chamber resources.
- 5. Zakāt would be distributed in the areas of its collection.
- 6. The law established punishments for those who refused to pay zakāt or tried to avoid paying.
- 7. Twenty percent of the zakāt paid could be distributed by those who paid it, to the eligible poor, relatives, and neighbors.
The Zakāt Law of 1990 addressed two important components of zakāt, its collection and its distribution. Regarding collection, the law defined six categories of wealth that would be subject to the zakāt: (1) agricultural production; (2) livestock production; (3) trade goods; (4) means of production, such as factories, real estate, modes of transportation, and so forth; (5) earned wealth (e.g., profits from investments); (6) salaries, benefits, awards, and profits. The Zakāt Law of 1990 established a clear definition for each of these categories and, based on the opinions of Muslim scholars, stated how the zakāt was to be collected.
As for the distribution of zakāt, in Sudan's fourteen years of experience administering zakāt, the zakāt chamber developed a system that adheres clearly to the basic jurisprudence while taking into consideration Sudan's local circumstances. Hence, zakāt is divided according to the following rates: 50 percent of the zakāt goes to the needy—the poor, the destitute, and wayfarers; 30 percent is spent on the Islamic call (daʿwah, missionary activity); 12.5 percent is spent on the administration of zakāt; and 7.5 percent is reserved for the construction of facilities for zakāt collection and distribution.
Sudan's zakāt experience, short as it is, still requires great effort to solve the many problems that it faces. The relation between the zakāt and the secular tax system must be addressed. Some authorities have questioned whether the zakāt should in fact be applied to the means of production. Scholars are attempting to determine which approach (to include the means of production or not) is more beneficial to the zakāt system and more likely to ensure its success.
Contemporary experience with zakāt in Pakistan began in 1979 with President Zia ul-Haq's Islamization program. A zakāt fund was created in 1979 with substantial assistance from Saudi Arabia and the United Arab Emirates. Collection and distribution of zakāt was managed by a multitiered administrative system. The application of zakāt in Pakistan was based on the Zakāt and ʿUshr Ordinance of 1980, which took effect in 1981. According to this law, the collection and distribution of zakāt became a state duty instead of being left to individuals as before. Under the 1980 law, the zakāt or wealth tax of 2.5 percent is assessed annually on all income or assets in excess of 2,000 rupees (approximately $200) and deducted directly from bank accounts and other financial assets, such as investment shares, annuities, and insurance.
State collection and distribution of the zakāt drew some critics. They questioned government intervention and control of what they regarded as a personal obligation before God, not the state. The Shīʿī minority community, which has its own legal system, objected to the application of Sunnī law. In response, the government amended the zakāt ordinance to exempt those who believed that compulsory deduction of zakāt was against their school of law. As a result, many Sunnīs showed up at their banks claiming to be Shīʿīs.
Many contemporary Muslim thinkers have equated zakāt with a social welfare system and have expressed hope that its application will solve the social and economic problems of developing nations with widespread poverty and inadequate social welfare nets. Plans of eradicating poverty through this means seem doomed to failure, however, not least because real estate, investment property, and the means of production are excluded from zakāt. The efforts by Islamic governments to impose zakāt are viewed with suspicion by many citizens, who do not see such applications of Islamic law as movements toward social welfare and a more equitable distribution of national wealth, but rather believe that the governments are disingenuously attempting to impose heavier taxes on the populace for the benefit of the ruling class without admitting that they are doing so, and even worse, while claiming to be acting out of piety.
Closely related to zakāt are zakāt al-fiṭrah and ʿushr (the tenth, or tithe). Zakāt al-fiṭrah is a special tax paid on the feast day when Muslims break the fast at the end of the month of Ramadan (ʿĪd al-Fiṭr). It should be paid by every responsible adult Muslim who is financially able to do so, and should be paid by the head of the household on behalf of all dependents in the household, including guests, to needy or destitute Muslims of ostensible moral integrity. The amount is set at one ṣāʿ (about three kilograms) per household member of the staple foodstuff of the region, such as wheat or rice, or a cash equivalent. The ʿushr is a tax paid as a religious obligation on agricultural produce. In general, 10 percent is paid for crops that grow without irrigation, and 5 percent is paid for crops that must be irrigated by the farmer. The rightful recipients of ʿushr are the same as those eligible to receive zakāt.
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