ANALYTICAL STUDY OF CHALLENGES OF ZAKAT
DISTRIBUTION IN INDIA
BY
SABAHUDDIN
A research paper submitted in fulfilment of the requirement
for the degree of Master of Science in
Islamic Banking and Finance
IIUM Institute of Islamic Banking and Finance
International Islamic University Malaysia
AUGUST2014
ii
ABSTRACT
Poverty is a very challenging phenomenon in the contemporary world. To address this
phenomenon United Nation set some Millennium Development Goals in 2000. But
these MDG could not bring any significance change in the lives of poor. To the date
more than 1.2 billion people are living under the poverty. However, Islam has
addressed this issue in a very effective manner under the concept of Zakat. It has
proved its efficiency several times in the history. Some Muslim majority countries are
trying to adopt Zakat as a tool of alleviation and eradication of poverty but there are
still some challenges. In this study, these challenges were determined to examine the
situation of Zakat distribution in India. In India, there is no formal way to manage
Zakat. It is distributed in unorganized, chaotic and on individual basis. This study is
all about to find out and analyze the challenges of Zakat distribution in India. This
study came up with some challenges such as absence of accountability and
transparency. Secondly, the system of Zakat collection and distribution is very
conventional and outdated. Thirdly, thehuge amount of fund goes to Madaris which do
not serve purpose of Zakat. As a result, poor and needy stay deprived and their
economic situation is exacerbating day after another day. Fourthly, Zakat is
distributed randomly. There is complete absence of planning and strategy of allocation
of Zakat fund. Finally, People are losing trustworthiness from the Zakat managers.
These are the main challenges of ineffectiveness of Zakat distribution in India. This
study has made some recommendations to manage Zakat in better way.
iv
APPROVAL PAGE
I certify that I have supervised and read this study and that in my opinion it conforms
to the acceptable standards of scholarly presentation and is fully adequate, in scope
and quality, as a research paper for the degree of Master of Science in Islamic
Banking and Finance.
…………………………………….
Mustafa Omar Mohammad
Supervisor
This research paper was submitted to IIUM Institute of Islamic Banking and Finance
and is accepted as a fulfilment of the requirement for the degree of Master of Science
in Islamic Banking and Finance.
..…………………………………...
Syed Musa Bin Syed
JaafarAlhabshi.
Dean, IIUM Institute of Islamic
Banking and Finance
v
DECLARATION
I hereby declare that this Research Paper is the result of my own investigations, except
where otherwise stated. I also declare that it has not been previously or concurrently
submitted as a whole for any other degrees at IIUM or other institutions.
Sabahuddin
Signature …………………………………… Date ………………………...
vi
INTERNATIONAL ISLAMIC UNIVERSITY MALAYSIA
DECLARATION OF COPYRIGHT AND AFFIRMATION OF
FAIR USE OF UNPUBLISHED RESEARCH
Copyright © 2014 by International Islamic University Malaysia. All rights reserved.
ANALYTICAL STUDY OF CHALLENGES OF ZAKAT
DISTRIBUTION IN INDIA
No part of this unpublished research may be reproduced, stored in a retrieval
system, or transmitted, in any form or by any means, eletronic, mechanical,
photocopying, recording or otherwise without prior written permission of the
copyright holder except as provided below:
1. Any material contained in or derived from this unpublished research may
only be used by others in their writing with due acknowledgement.
2. IIUM or its library will have right to make and transmit copies (print or
electronic) for institutional and academic purposes.
3. The IIUM library will have the right to make, store in a retrieval system
and supply copies of this unpublished research if requested by other
universities and research libraries.
Affirmed by Sabahuddin
……………………… ……. ………………..
Signature Date
vii
I hereby dedicate this Research Paper to my beloved Parents who raised me on the
principles of Islam and to my friend Habib Mohtashim who was the reason to join the
Institute of Islamic banking and finance at International Islamic University, Malaysia.
viii
ACKNOWLEDGEMENTS
First and foremost, I am thankful to Allah SWT, the Most Gracious and the Most
Merciful for giving me the chance to pursue Master Degree. Without His blessings I
would not have the strength and patience to complete this study successfully.
I would like to express my sincere gratitude to my supervisor Dr.Mustafa
Omar Mohammed for his guidance, patience, ideas, efforts and valuable teachings and
advices throughout the entire process of writing this research paper. I would not be
able to complete this study successfully without his assistance, guidance, and
supervision.
I also want to convey my deepest appreciation to all my interviewees for
assisting me through providing valuable interviews required for this study. I would
like to thank my all my senior fellows for helping me to complete the core objective
part of this research paper through their insightful comments.
I would also like to register my special thanks to all IIiBF lecturers for their
teachings and support in successfully completing my Master program. I would also
like to extend my heartfelt thanks to the staff of IIUM Library who work hard to
maintain library to be user friendly. Last but not least, I record my deepest gratitude
to my parents, my siblings for their love, care and deep concern for me in their life.
ix
TABLE OF CONTENTS
Abstract ................................................................................................................... ii
Abstract in Arabic .................................................................................................... iii
Approval Page .......................................................................................................... iv
Declaration ............................................................................................................... v
Copyright Page ......................................................................................................... vi
Dedication ............................................................................................................... vii
Acknowledgements .................................................................................................. viii
List of Tables ........................................................................................................... xi
CHAPTER ONE: INTRODUCTION .................................................................. 1 1.1 Introduction ........................................................................................... 1
1.2 Zakat Management and Challenges ...................................................... 5
1.3 Challenges of Zakat Distribution .......................................................... 7
1.4 Problem Statement ................................................................................ 9
1.5 Objectives of Study ............................................................................... 10
1.6 Scope and Limitations of the Study ...................................................... 10
CHAPTER TWO: LITERATURE REVIEW ..................................................... 11 1.2 Introduction of Zakat............................................................................. 11
2.1.1 Zakatable Items ............................................................................ 13
2.2 Historical Development of Zakat. ......................................................... 14
2.3 Zakat Management ................................................................................ 15
2.3.1 Zakat Management in the Contemporary World ......................... 15
2.3.2 Zakat Management in Pakistan .................................................... 16
2.3.3 Zakat Management in Indonesia .................................................. 20
2.3.4 Zakat Management in Malaysia .................................................. 21
2.3.5 Zakat Management in India ......................................................... 23
2.4 Issues and Challenges in Zakat Distribution ......................................... 25
2.5 Summary ................................................................................................ 31
CHAPTER THREE: RESEARCH DESIGN AND METHODOLOGY .......... 32 3.1 Introduction ........................................................................................... 32
3.2 Research Instruments ............................................................................ 33
3.3 Contents Analysis. ................................................................................. 34
3.4 Limitations of the Study ........................................................................ 35
3.5 Summary ............................................................................................... 36
CHAPTER FOUR: FINDINGS AND RESULTS ............................................... 37 4.1 Findings & Analysis .............................................................................. 37
4.2 Summary ............................................................................................... 47
CHAPTER FIVE: CONCLUSION AND RECOMMENDATION ................... 48 5.1 Conclusion ............................................................................................ 48
x
5.2 Recommendations ................................................................................. 52
BIBLIOGRAPHY .................................................................................................. 53
APPENDIX 1: INTERVIEW QUESTIONS ........................................................... 56
APPENDIX 2: INTERVIEWS ................................................................................ 57
1
CHAPTER ONE
INTRODUCTION
1.1 INTRODUCTION
Poverty is a major problem of the modern world. The threshold of poverty is very
high, based on the recent statistics more than 1.2 billion people are living under the
poverty line (World Bank Report 2013). In the region of Saharan Africa alone, almost
half of the population is living on less than $1.25 a day. Saharan Africa saw the
number of people living in the extreme poverty rise steadily, from 290 million in 1990
to 414 million in 2010. Statistics show that even most progressive countries among the
least developed African countries could not succeed to alleviate their people from
poverty. For example, Uganda alone is a house of 7.5 million absolute poor people and
13.00 million “insecure non poor” people which account of 67.4 of its population
(Uganda Poverty Status Report 2012).
Similarly, poverty in most of the OIC-member countries as more than 50
percent of their population is extremely poor. Among these countries are Burkina Faso
(56.5%), Chad (61.9%), Guinea (70.1%), Mali (51.4%), Mozambique (74.7%), Niger
(65.9%), Nigeria (64.4%), and Sierra Leone (53.4%). The incidence of poverty in
Bangladesh (49.6%), Benin (47.3 %), Comoros (46.1 %), guinea-Bissau (48.8 %) and
Uzbekistan (46.3 %) is also very high (Shirazi and Fouad 2009).
This incidence of poverty does not only prevail in least developed countries
but it is also common to the developing countries. However, due to socio-economic
progress in many countries in the region saw a reduction in poverty level although a
significance number of people are living under the poverty line.For example, India
alone is a home to 363 million poor or 29.6 percent of the Indian population is living
2
below poverty (Report of the Expert Group to Review the Methodology for
Measurement of Poverty 2014).
Ironically, many poor people living in developed countries such as in the
United States are also experiencing poverty. For instance, statistics shows that in
1959, 22.4 percent of all persons were poor according to the official measure in the
USA. This was cut by half by 1973 in the USA because of rapid economic growth and
the expansion of safety net programs in the aftermath of the War on Poverty. But
nothing much happened for the next four decades. The poverty rate has never fallen
below the historic low of 11.1 percent reached in 1973, and only in the booming
economy of the late 1990s did it come close to that mark. Instead, the trend over the
past 40 years consists of ups during recessions and downs during economic
recoveries, but no long-term progress (Poverty and Inequality Report 2014).
To address the problem of poverty, the United Nation set eight Millennium
Development (MDG) Goals giving priority to the eradication of poverty. The World
Bank recommended dual approach: a) efficient labor-intensive growth based on
appropriate market incentives, physical infrastructure, institutions and technological
innovation; and b) adequate provision of social services, including primary education,
basic health care and family planning services.
In 2000 UN targeted to halve the proportion of people living below poverty
line or suffering from hunger by 2015. However, it is unfortunate that there is not as
yet much accumulated research evidence of the extent of such impact (Manning
2010). But the World Bank (2013) claimed that the first goal has been achieved five
years ahead of its deadline 2015. Evidence for this claim is straight forward due to a
higher initial headcount ratio in India or China where poverty reduction in these
3
countries contributed a greater relative weight in the calculation of the global poverty
headcount (or headcount ratio) (Reddy and Minoiu 2007).
This claim however still remains hard to be proven because still 1.2 billion
poor are living in the world and in some region especially Sub Saharan Africa poverty
saw a steady rise. Poverty and Inequality Report (2014) states that the goal of the war
on poverty have not been achieved. It is also substantiated when ShaZukang, under-
secretary-general for economic and social affairs admits that too little is being done
too slowly to significantly improve conditions, especially for the poor. The General
Assembly realized this fact and proclaimed 2008-2017 as the Second Decade for the
Eradication of Poverty in resolution 62/205 of 19 December 2007 (Rethinking Poverty
Report on the World Social Situation 2010). The World Bank contradicts itself when
it projected that by 2015; about 970 million people would still be living on less than
$1.25 a day in countries classified as low- or middle-income in 1990. Instead, Sub-
Saharan Africa and Southern Asia would each be home to about 40 per cent of the
developing world population living in extreme poverty.
The initiatives taken by the international community failed towards poverty
eradication mainly due to two reasons. Firstly, although the amount of development
assistance has increased over the past decade, the richest states have failed to meet
their commitment to donate 0.7% of the gross national income. G8 countries also
failed to meet a promise to double aid to Africa by 2010, made at a summit in
Gleneagles, in Scotland in 2005.1Rippin (2013) stated that the Millennium
Development Goals were perceived as a mere donor agenda and a lack of ownership
and commitment was a direct result of this perception. Thus, while the MDGs had a
1http://www.bbc.com/news/world-11364717
4
highly motivating effect on donors, their effect on developing countries was much less
promising.
Secondly, the funds which were allocated to achieve MDGs could not reach
their targets. According to Professor Jeffrey Sachs, an MDG adviser to UN Secretary
General Ban Ki-moon, the rich countries focus on their own project rather than
pooling their money into global fund which is designed to support developing
countries.2 Furthermore, the problem is aggravated because the least developed
countries are suffering from weak and autocratic political system. It has estimated by
an African Union study (2002) that the corruption cost the continent roughly $150
billion a year while aid given to sub-Saharan Africa by the developed countries was
only $22.5 billion in aid.3 It also has been reported that these aids were used in other
projects of countries instead of allocating to eradicate poverty. Subsequently, the poor
were no longer the first beneficiaries of the fund.
The institution of Zakat could provide remedy for the failure of poverty
eradication discussed above, especially to address the lack of commitments of donors
and corruption. To address these two problems of poverty Islam through Zakat has
made it an obligation and levied a certain amount of wealth on every wealthy member
of the society which has to be paid annually under the concept of Zakat. As Qur’an
states that "And those in whose wealth there is a known right, for the beggar who
asks, and for the unlucky who has lost his property and wealth, (and his means of
living has been straitened”(AL Quran 70: 24-25).
The donors are responsible to ensure that Zakat has reached to the targets
unlike MDGs aids. Furthermore, donors are not allowed to expect any compensation
from the poor unlike MDGs’ donor countries. As it is reported, that the donor
2http://www.bbc.com/news/world-11364717.
3http://www.cfr.org/africa-sub-saharan/corruption-sub-saharan-africa/p19984
5
countries influence politically on the management of developing and least developed
countries and manipulate their economic sources behind the aids they provide to the
poor countries on the name of MDGs. It can be estimated that the nominal illicit
outflows from developing countries amounted to US$946.7 billion in 2011, up 13.7
percent from US$832.4 in 2010 (Kar & Leblanc, 2013).
In addition to that, Zakat posses a very distinguished mechanism of
distribution of Zakat fund that challenge poverty on a very micro level due to the
following some characteristics. Firstly, Zakat fund is only disbursed among the people
who fall in (specific eligible categories for Zakat fund) Asnaf. Secondly, Zakat fund is
rewarded to poor recipients intending to alleviate them from poverty line. Finally, the
Outflow of Zakat fund is not allowed until needs of the local citizens are fulfilled.
With such characteristics, Zakat provides the best remedy for the eradication of
poverty.
However, currently Zakat is facing some challenges regarding distribution of
fund. This is due to lack of awareness about distribution, absence of institutional
support for Zakat distribution, lack of crystallized concept of Zakat distribution and
lack of coordination of Zakat institutions. In the next section contemporary Zakat
management and challenges will be discussed.
1.2 ZAKAT MANAGEMENT AND CHALLENGES
Since the inception of Zakat, its fund used to be collected and distributed by the
Islamic state. Prophet (PBUH) used to send administrators to collect Zakat from rich
people and distribute it among the poor. This system continued until the last Islamic
caliphate in 1892. During this long period Zakat had proved its efficiency many times.
Governors of Egypt and Yemen used to send surplus fund to the capital of Islamic
6
state of Madina. Even during the time of Umar bin Abdal Aziz, Zakat collectors in
North Africa had difficulty finding people worthy of receiving Zakat locally.
But the rise of colonial powers and collapse of Islamic caliphate debunked the
institution of Zakat. It disturbed the connection of the institution of Zakat with the
state. It rendered Zakat a voluntary ineffective institution. Since the last four decades,
Muslim scholars started to discuss Zakat and its potential impacts on Muslim society.
As a result once again many Muslim countries started to show their interest in
incorporating Zakat in the systems.
In 1968, Zakat was institutionalized in Indonesia and established at provincial
government- sponsored Zakat centers. In 1980, Pakistan introduced a very
comprehensive Ordinance on Zakat and Usher. All Zakat and Usher affairs are dealt
by ministry of religious affairs (MORA) Islamabad. In 1991, Malaysia introduced a
new corporate style of Zakat collection. Saudi Arabia introduced a centralized Zakat
system and Kuwait also implemented partially centralized system of Zakat collection
and distribution. However, there are majority of the countries who did not pay heed to
regulate institution of Zakat for example Qatar, Emirates, Bangladesh, India and
others. In these countries Zakat is collected and distributed privately.
However, in many countries institution of Zakat has experienced a tremendous
development in terms of infrastructure, human capital delivery system and governance
transparency, but still there are issues and challenges of Zakat management to be
addressed in order to realize the potentials of Zakat such as eradicating poverty and
elevating people’s living standard nationally and internationally. No matter how good
the system is developed, if it does not cater for the needs of the community especially
the poor and needy, such institution is considered inefficient (Mohammad et al.,
7
2011). In order to empower institution of Zakat all over the world a number of
challenges and issues have to be addressed.
1.3 CHALLENGES OF ZAKAT DISTRIBUTION
Zakat management all over the world faces several challenges and issues in terms of
collection and distribution the most important are: First, lack of public awareness in
paying Zakat. For example, people in Malaysia are strongly aware that Zakat in an
obligation in Islam but they merely know when and on what types of wealth Zakat is
obliged (Nadwi et al., 2014). Lack of awareness about basics of Zakat and it actual
recipients may lead to inappropriate distribution of Zakat fund. Second, the absence
of institutional support on Zakat collection and distribution. Malaysia has shown a
tremendous interest in instituting Zakat but still Zakat remain optional unlike taxation
(Abdul Aziz & Abdullah 2013). Subsequently, only 160,000 out of approximately 2
million Muslims population in Selangor (8%) are paying Zakat.
Third, the absence of the standardized concept among the existing Zakat
management bodies. As in Malaysia, there are separate bodies for each state to
regulate religious affairs which have differences in the interpretation and
implementation of Zakat in their states. This scenario has led to the issues of Al-
Awlawiyyat (prioritization) in distributing Zakat money (MdSaad&Abdullah 2011).
It was argued that for certain states, priority is not given to the poor and hardcore poor
categories of asnaf. It seems that this practice is inconsistent with the main objectives
of Zakat which is to alleviate poverty (Aida 2012).
Forth, lack of coordination among Zakat institutions. In the countries where
Zakat is institutionalized not centralized, lack of coordination might create a problem
of overlapping, especially on distributing the Zakat funds. In addition it might create a
8
stiff and unhealthy competition among Zakat collection centers (Hudayati & Tohirin
2010). It is reported that some institutions sometimes have surplus of Zakat fund while
others have deficit.
Fifth, prospective payers. Zakat institutions are suggested to improve the
ability of Zakat collection and distribution centers to identify not only those who
should pay Zakat, but also to trace down the prospective Zakat payers. AbRehman et
al. (2012) also stressed that Zakat institutions need to be more proactive in raising
awareness among prospective Zakat payers instead of waiting at the Zakat counters. It
is only possible by organizing briefing sessions on the Zakat to Students, public and
workers in different organization. There should be enactment of seasonal trainings and
short courses.
Sixth, capacity building. Eradicating poverty and helping people out is an
inspiration of all people. But giving poor a sum of money does not seem a real and
long term solution. It may give people a short term relief. Rather, it would create a
dependency on Zakat receipts which would not help them in enhancing their standard
of living. If the authority change the way financial assistance is given including in the
form of financing their children’s education or sending them to training centers to gain
certain skills; this would improve the future employability of the family members. The
poor person who has acquired the necessary skills from training given should be given
adequate capital from the Zakat fund for him/her to start a business venture. This
capacity building approach is an effective way to change the condition of the poor
from being a Zakat recipient to one who pays out Zakat (AbRahman et al., 2012).
As a result these issues which are applicable to the almost all Zakat institutions
in Muslim societies render the institution of Zakat inefficient in the distribution of
proceeds. AbRehman et al. (2012) highlighted the issue of inefficiency in Zakat
9
institutions might affect the objectives of Zakat. Bureaucracy problem in Zakat
institution play a negative role in terms of distribution. There are complaints made by
the public that Zakat does not reach the targeted group due to lack of publicity by the
authority or lack of knowledge on the part of the community (AbRahman et al., 2012).
1.4 PROBLEM STATEMENT
The institution of Zakat is one of the most important institutions in Islam. It is an
instrument of redistribution of wealth.It has played a vital role in the eradication of
poverty. It has continually functioned since its inception until secular powers took
over the Muslim states. These powers debunked the connection of institution of Zakat
from the states. Subsequently, Muslims were forced to pay Zakat privately in order to
fulfill their religious obligation which downgraded this important institution of Zakat
to just a mere donation.
But after achieving freedom from the secular colonial powers, Muslims started
to revive Islamic economic discipline including institution of Zakat. Many Muslim
countries showed their interest to incorporate or institute Zakat into the system for
example Indonesia, Pakistan and Malaysia. However, still Zakat is facing many
challenges and issues related efficiency of its management, awareness about Zakat,
collection and distribution, prospective payers, lack of institutional support, lack of
coordination among Zakat institutions and capacity building of payees.
These issues have been highlighted by several literatures in Muslim countries.
But there is no formal study that has been conducted in India in order to determine the
issues and challenges facing Zakat distribution. In this study a general literature
survey in the challenges of Zakat distribution will be conducted in order to determine
issues and challenges of Zakat distribution in the Muslim countries. These issues and
10
challenges would be examined in the current situation of Zakat in India to be critically
analyzed.
1.5 OBJECTIVES OF STUDY
Although, the management of Zakat has undergone many improvements in terms of
infrastructure, human capital, delivery system and governance transparency in some
countries like Indonesia, Pakistan and Malaysia, there are still some challenges and
issues before Zakat management that need to be studied and examined to ensure
implementation of Zakat. The main objectives of this study are:
i. To review/ survey literature in the challenges of distribution of Zakat.
ii. To examine the current situation of Zakat distributio in India.
iii. To critically analyze the challenges of Zakat distribution in India.
1.6 SCOPE AND LIMITATIONS OF THE STUDY
This study has some limitations in terms of coverage and data collection. This study
focuses only on the reviewing the literature in the challenges of Zakat distribution in
order to examine and analysis the current situation of Zakat distribution in India.
Therefore, other juristically controversial issues do not come within the purview of
this study (because of their irrelevance or semi relevance to the actual outlook of this
study). However, It might discus some of them which are highly related to the topic
and suggest some recommendations to enhance the study.
11
CHAPTER TWO
LITERATURE REVIEW
This chapter includes introduction of Zakat, historical development in the
implementation of Zakat. In the second section, the current practicing models of Zakat
in different Muslims countries including situation of Zakat are reviewed. Lastly, the
challenges before these Zakat models are determined.
2.1 INTRODUCTION OF ZAKAT
Zakat is one of the five pillars of Islam. It is an obligatory form of worship prescribed
by Allah the almighty. Allah commanded in the Qur’an: “so establish Salah and give
Zakat, and hold fast to Allah” (Al-Qur’an 22:78.) In order to define Zakat accurately,
it should be seen from three aspects linguistically, theologically and legally. Zakat
literally means to grow and to increase. Linguistically, Zakat means cleansing or
purification of something from dirt or filth (Almujam Al waseet 1972). Theologically,
“it is an obligatory duty (Fard) on every Muslim and Muslimah possessing wealth
equal to or exceeding the prescribed amount of Nisab.”As Qur’an says "And those in
whose wealth there is a known right, for the beggar who asks, and for the unlucky
who has lost his property and wealth, (and his means of living has been straitened)”
(Al-Qur’an 70, 24-25).
In the other verse, Allah the almighty commands to pay Zakat in “Of their
goods, take alms, so that you might purify and sanctify them” (Al-Qur’an 9:103).
Maududi (1988) discussed further that a person’s wealth is impure if he does not pay
the right of Allah’s servant from the wealth bestowed by him. It also means growth or
increase which has two dimensions; first, spiritual development by pleasing Allah, and
12
second, redistribution of income (as Islam forbids accumulation and hoarding) which
will lead to greater enjoyment and in turn, will stimulate production and growth.
Legally, Zakat means transfer of ownership of specific property to specific individuals
under specific conditions (Rahman 2012).
Due to being one of the five fundamental obligations and most important tool
of redistribution of wealth in Islam, aspect of Zakat distribution articulated very
succinctly in Qur’an “As-Sadaqat(here it means Zakat) are only for the Fuqara' (poor),
and Al-Masakin (the poor) and those employed to collect (the funds); and for to attract
the hearts of those who have been inclined (towards Islam); and to free the captives;
and for those in debt; and for Allah's Cause (i.e. for Mujahideen - those fighting in the
holy wars), and for the wayfarer (a traveler who is cut off from everything); a duty
imposed by Allah. And Allah is All-Knower, All-Wise” (Al-Qur’an 9:60).
This verse mentioned eight categories and confined the distribution of Zakat
fund in these categories. Although some fuqaha (jurists) believe that Zakah proceeds
must be equally distributed between to these eight categories, but the majority of
them agree that these two (poor and needy) categories make up the main recipients of
Zakat and they must be paid as much required to satisfy their basic need provided
there are sufficient fund (Kahaf). The categories of Zakat recipients are defined as:
1. Faqir: This group of people whose property is below the Nisab threshold. They are
poor and destitute and need other people’s help to survive, either because of their
physical inability, old age or others.
2. Masakin: Consist of the poor or in other words needy who does own nothing.
3. Amilin:Those who work in administering and managing matters related to Zakat.
Inclusive in this category are the officers and members of the staff appointed by the
state to manage Zakat matters such as calculation, collection and disbursement. This
13
group of people is entitled to be paid from the Zakat fund (BakarandMahyuddin
2011).
4. Muallafat al Qulub: This group of people are those whose hearts are reconciled to
the Islamic religion. Those in this category include those who have close relationship
and strong commitment to solidify Islam such as people who recently embraced Islam
and gave up their all things including wealth, property, and relative for the of Islam.
Jurists decree that it must only be done by a collective decision through the Islamic
government or national organization of Muslim minorities (Kahaf n d).
5. Riqab: To free slaves. In the current situation, the slavery system has long been
abolished. These days, however, the interpretation has been extended to those who are
oppressed such as Muslims who are restricted from performing their duties under the
rule of non-Muslim reign (Bakar&Mahyuddin 2011)
6. Gharimin:People who are in debt. Muslims who are in debt and have no resources
to pay their debts considered acceptable in Islam such as being in debt to get basis
amenities to sustain their lives and those under their care.
7. Fi sabilillah: Fighters in the cause of Allah to promote Islam such as students and
those who are in the war to protect Islamic countries from the invasion of enemies of
Islam (Bakar&Mahyuddin 2011).
2.1.1 Zakatable Items
There are several opinions about Zakat payable items. The first opinion considers that
Zakat is only imposed on four types of gold and silver, freely pastured, cows, camels,
and sheep agricultural products (barley, wheat, dates and resin). The second opinion
which is hold by majority expands it by including views of some contemporary
scholars who include in the Zakat base the return on fixed assets used in the sectors of