Understanding Professional Zakat From A Contemporary Islamic Economic Perspective

Zakat is one of the five pillars of Islam. Derived from the Arabic root “z-k-a,” which means “to purify” or “to grow,” Zakat represents the act of giving a portion of one’s wealth to those in need, essentially purifying one’s own assets while simultaneously fostering social welfare.

There are three types of zakat namely, Zakat Al fitr, Zakat almal and income zakat. The first two are unanimously recognized by all scholars on its obligation. Moreover, the disputes still continue whether there’s a zakat named professional zakat or zakat on income as it is not found in prophetic age. In fact, what is professional zakat? How professional zakat varies from other two types of zakat? What are the derived benefits while imposing professional zakat?

Professional Zakat, or income Zakat, is a zakat on income like tax, popularized by Imam Qardawi in respect to widening the scope of socialization of Islamic legacy. Yusuf Qardhawi explicitly defines a profession as a job or business that independently generates income, whether conducted solo or with reliance on external entities like the government, private companies, or individuals, in return for wages, salary, or honorarium.

Though professional zakat is introduced by Wahhab Al-Zuhaili in his book Islamic Fiqh Wadillathullah, it was brought into the limelight of jurisprudential world by Yusuf Al Qardawi in his book ‘Fiqh Zakat’ where he left solely a chapter to discuss various aspects and dimensions of professional Zakat. According to him, Zakat is obliged to every wealth (Al-mal) that generates itself.

The zakatability of an asset can be deduced based on its actual growth(نماء تحقيقي) or it has potential to grow (نماء تقديري).  It means that the wealth has to be actually or potentially provide its owner with profit and benefit. So, the term professional zakat may entail salary, bonuses, remunerations, rental payment, gift, professional service; zakat on income, zakat on agricultural products, zakat on stocks and shares,  excluding personal belongings like fixed assets at home, furniture, home inventories.

A basic motive for implementing professional zakat is to enlarge the scope of Islamic concept on mutual social responsibility and ethical reconstruction of social financing. The philosophy of Imam Qardawi is a humanitarian approach and his teachings mostly  be adhered in favor of  widening the economic welfare of the society. 

Evidence for Professional Zakat

The obligation of professional zakat is evidenced by extending the meaning of quranic verse وَفِىٓ أَمْوَٰلِهِمْ حَقٌّۭ لِّلسَّآئِلِ وَٱلْمَحْرُومِ

And in their wealth there is a right for the poor who ask and the poor who don’t get a share” and 2:267 يَـٰٓأَيُّهَا ٱلَّذِينَ ءَامَنُوٓا۟ أَنفِقُوا۟ مِن طَيِّبَـٰتِ مَا كَسَبْتُمْ وَمِمَّآ أَخْرَجْنَا لَكُم مِّنَ ٱلْأَرْضِ ۖ.

Both these verses elaborate the obligation of zakat from every good (halal) earnings. Imam Qardawi annotates istinbat analogy and derives zakat on income also comes under permissible earnings and it’s counted as a growing wealth. In spite of them, the subsidiary sources also include  Qiyas, istihsan, masalih murasaha, ‘Uruf ant etc… 

There are several historical records of the presence of professional zakat in the khilafat period and Umayyad caliphate. The Arabic term ‘almal ul-Mustafad is the exact translation of professional zakat. Traditional jurisprudential texts give several mentions of almal ul Mustafad which connote to the concept of professional zakat in modern period.

During the Umar Caliphate, professional zakat imposed on honey, horses, lentils and sea products. Caliph Uthman ibn Affan came up with the imposition of zakat on the net wealth after considering all deductions of the zakat payers debts. Besides that, it is reported that several Companions believed in the obligation of zakat on earned income like Ibn ‘Abbas, Ibn Mas’ud and Muawiyah. The first caliph who officially imposed zakat on salaries in a systematic way is Mu’awiyah. During the reign of Umar bn Abdal Aziz, zakat on income was a common practice in the society. 

Then, the question arises as to why the Prophet doesn’t include professional zakat as an obligatory practice? The answer is simple, in prophetic age, the people mostly depend on livestock and agriculture for day-to-day expenses and they were included primarily as zakatable wealth. In later periods, parallel to the growth of financial resources, the jurists also added zakatable items to balance the socioeconomic order of Islamic financial system. 

The Issuance of Professional Zakat

Imam Qardawi proposes three methods, three varied discourses for calculating professional zakat based on haul and nisab.

1. Gross expenditure Method, namely issuing zakat on gross income. That is, zakat income that reaches the nisab of 85 grams of gold in a year, is issued 2.5% immediately upon receipt before deducting anything. For example, if you get 4,00,000 per month, then 4,00,000 *12 = 48,00,000 and 2.5% of 48,00,000 is 1,20,000 is obligatory to give as zakat. This is also based on the opinion of Az-Zuhri and Auza‟i, he explained: “If a person earns income and wants to spend it before the month of obligatory zakat comes, then he should immediately issue zakat first before spending it” (Ibn Abi Syaibah, Al- mushannif, 4/30).
2. After deducting work operations including transportation charges, rent, electricity , miscellaneous expenses and etc.., that is, after receiving salary or honorarium income that reaches the nisab, it is deducted first with work operational costs. In the above example, if he has a total of 50,000 work operational costs each month, it should be deducted. 50,000*12 = 6,00,000. Then, 48,00,000 – 6,00,000= 42,00,000. 2.5% of 42,00,000 which is 1,05,000. 
3. Expenditure or net zakat Method, or haddhul kifayath  zakat issued on net Amount of money; obligation comes when nisab reaches after deducting daily expenses including food, housing, debt, and other essentials for the needs of the donor, his family, and dependents. Based on this method, When his liabilities exceed assets, he is still regarded as a poor even if he earns in crores. This is based on the hadith narrated by Imam Al-Bukhari from Hakim bin Hizam that the Prophet SAW said: ”and it is best for zakat to be issued from excess needs” (Elpianti Sahara Pakpahan, 2018).

On the basis of haul, scholars dispute on whether haul is mandatory in case of professional zakat. Yusuf al-Qaradawi states that the obligation of zakat underlies when the asset met all zakat requirements including nisab, being debt-free and surplus from basic needs. 

Professional Zakat: A Global Perspective

In modern Islamic financial system, several countries have mandated professional zakat to be given on a yearly basis. Indonesia, Malaysia and Middle East countries have adopted certain policies regarding zakat collection and distribution and included zakat on income as an obligatory practice.

In 2002, the Indonesian Ulema Council (MUI) stipulated fatwa that any income—including salary, honorarium, wages, —obtained through legal means—such as from doctors, lawyers, consultants, and the like—as well as any income from other independent work—must be issued as zakat if it satisfies the requirements of the zakat obligation. In Malaysia, zakat on income is obligated by national fatwas and its final amendment established in 2003 as “Muzakarah has determined that the basis for calculating zakat on salary and income is gross annual income, and the zakat rate is 2.5 percent of total income.” (Paizin, M. N. (2021, July 20). The concept of zakat on income in Malaysia)

However, there are several disagreements on its obligation. Dr Wahbah Az Zuhaili, Prof. Ali As Salus, Sheikh Bin Baz, Hi’ah Kibaril ulama, PERSIS Hisbah Council and Bahtsul Masail NU have already rejected the presence of professional as it’s not found out in prophetic period and classical texts. Meanwhile, the PERSIS Hisbah Council and Bahtsul Masail NU use trade zakat in the place of professional zakat. 

In sum, the role of professional zakat in fostering social welfare is a huge one. It helped reduce the poverty level a lot. Imam Qardawi gave a detailed picture of the implementation and impact of professional zakat in modern Islamic economic system.

In contrast to income tax, professional zakat helps elevate both the welfare of the people and charitable status of the overall economy. So, it’s recommended to implement a systematic, efficient system (digitalization of zakat management may be more helpful) of professional zakat management in all Muslim countries and territories in order to balance the warfare of people at whole. 

References

Abdullah, S., Rahman, A. A., & Abdullah, L. H. (2023). Exploring Zakatable Wealth from Classical and Contemporary Scholars Perspectives. UMRAN, 10(2), 53–70. https://doi.org/10.11113/umran2023.10n2.614

Adnan, M. A. (2017). The need of establishment of professional Amil Zakat to enhance the future zakat development. International Journal of Zakat, 2(1), 71–79. https://doi.org/10.37706/ijaz.v2i1.16

Husain, H., Hamzah, N., Asse, A., & Kara, M. (2019). Yusuf Al-Qaradawi Concept on professional Zakat. International Journal of Multicultural and Multireligious Understanding, 6(6), 1. https://doi.org/10.18415/ijmmu.v6i6.1185

Ihsan, A., & Agustur, A. (2022). Revitalization of The Collection of Zakat Funds in Indonesia: An Explana-tion from Yusuf Al-Qaradawi’s Fiqh Al-Zakah. Journal of Islamic Economics Lariba, 8(2). https://doi.org/10.20885/jielariba.vol8.iss2.art10

Nurlaelawati, E. (2010). Zakat and the concept of ownership in Islam: Yusuf Qaradawi’s Perspective on Islamic Economics. Al-jamiah, 48(2), 365–385. https://doi.org/10.14421/ajis.2010.482.365-385