Zakat, beyond cheap saris and rice packets

Around 30,000 people gathered in front of the gate of Anis Bari Jame Mosque located at Ghatiadanga village in Satkania upazila, Chittagong on May 15, 2018. Invited by an industrial group called Kabir Steel Re-rolling Mills (KSRM) to receive zakat, these poor people came from different corners of Chittagong division to collect a meagre donation of 5 kg rice, 5 kg lentils, Tk 1,000 cash and a sari for each person.

When the mosque's gate was opened at 9:00 am, all 30,000 people, waiting since the previous night, rushed to the mosque's courtyard to collect the goods. As there was no order, the distributors started to throw packets of rice, lentils and saris at the zakat recipients. As a result, the crowd turned into a deadly stampede. At least nine women were killed on the spot and 25 women and children were critically injured.

Rizia Begum was one of those 30,000 people who came from Lohagara upazila of Chittagong with her sister Nurjahan to receive zakat. When the stampede broke out, Rizia lost her sister as she fell down. “I fell down. I somehow managed to get up but she couldn't. I saw many women lying unconscious on the ground... when I found my sister among them, she was dead,” says a crying Rizia. In fact, poor people being trampled to death during zakat distribution is quite a common occurrence in Bangladesh. In 2015, a similar incident claimed the lives of 27 women and children and injured hundreds of others in Mymensingh.

Zakat, introduced in the holy Quran, brought in the concept of asset transfer to alleviate poverty. Paying zakat is an obligatory duty for every Muslim and it is considered one of the five pillars of Islam. By the principles of zakat, an eligible, well-off person who possesses wealth more than a threshold figure, termed as nisab for a total lunar year, is liable to pay 2.5 percent of that additional wealth as zakat. For an individual, the nisab by the gold standard is three ounces of gold (87.48 grams) or its cash equivalent and by silver standard is 21 ounces of silver (612.36 grams) or its equivalent in cash. In the Quran, it has also been clearly defined who can receive zakat.

However, it seems that for some of the rich in Bangladesh, paying  zakat is nothing but a display of their wealth and it resembles giving alms to beggars.

According to Islamic scholars, paying zakat in this manner, in fact, defeats its purpose. “Donating a piece of cheap cloth and some food to the poor is a defamation of zakat. Announcing the giving of zakat beforehand is also despicable. It is not charity; zakat is actually a right of the impoverished. It should be given in such a way that it can free a person from the trap of poverty,” says Dr Manzoor E Elahi, an Islamic scholar and a professor of National University.

However, due to a lack of initiative, huge amounts of zakat funds that could be used for sustainable alleviation of poverty remain untapped or the valuable resources go to total waste Other than the huge numbers of the Muslim population who can pay zakat from their personal assets, many private companies and industries can also pay zakat from their corporate zakat funds.

According to Dr Mokhter Ahmed, Shariah Consultant and Associate Professor, Islamic University of Technology: “If a person owns a company or industry, all of the company's accumulated assets, be they raw materials or finished goods for sale, are liable for zakat. If the company purchases land and real estate for reselling, those properties will also be subject to zakat. However, buildings and machineries, vehicles which are essential for operating the business are exempt from zakat.

“The companies that have taken loans to acquire zakatable assets, the amount of loan or currently due instalment will be deducted from their capital and they have to pay zakat on the remainder of the capital. But if the companies take loans for acquiring non-zakatable assets such as buildings, lands and machineries for utilising in the business, the amount of loan or currently due instalment cannot be deducted from the capital,” adds Dr Mokhter.

According to a study conducted by Dr M Kabir Hassan, Professor, University of New Orleans, it has been calculated that each year Tk 25,000 crore of personal and business zakat can be obtained from Bangladesh and, if distributed properly, each extremely poor family can get Tk 2,000,000  from this huge fund. The Bangladesh government has a Zakat Board and Zakat Fund Division under Islamic Foundation for collecting and distribution. Unfortunately, due to a lack of manpower and support from the government, this division is struggling to run its collection and distribution activities.

Nizam Uddin, Director of Zakat Fund Division says: “We collect zakat by requesting wealthy people to pay through our zakat funds. We have interest-free zakat accounts in 40 banks and in all the state-owned banks. However, we can only receive zakat if anybody goes to the banks voluntarily and deposits the money. We don't have assigned collectors and we also don't have assigned distributors. We disburse zakat funds through zakat committees formed and headed by deputy commissioners of respective districts.

“As we don't have adequate funds and manpower, our capacity to raise awareness of zakat, and the proper ways of collecting and distributing it is very limited,” he adds. According to Nizam, in the last fiscal year, only 3 crore 24 million and 25 thousand taka was deposited in the government zakat fund. Also, the division does not have any instrument and trained manpower to calculate personal and business zakat. 

“Islamic Religious Council of Singapore, which is also a government organisation, has devised online personal and business zakat calculators. If we could develop these instruments in our country, the government could earn a huge amount of revenue which could be utilised for sustainable poverty alleviation,” says Dr Mokhter Ahmed. 

Unlike the government-controlled Zakat Fund Division, non-profit organisation Centre for Zakat Management (CZM) has pioneered an institutionalised approach to zakat management in Bangladesh by implementing development projects through zakat funds.

The organisation has been implementing projects that include different kinds of livelihood development programmes, vocational training, maternal health and nutrition, and scholarship programmes for students. Niaz Rahim, Chairperson of CZM says: “The goal of the CZM is to collect zakat from businessmen and also from eligible individuals and utilise it collectively to bring about a sustainable change by alleviating poverty with full compliance of sharia laws. But the potential resource from zakat is so huge in Bangladesh that it is very difficult to manage it through only one or two organisations.”

For a country like Bangladesh, where more than 37.6 million people still live below the poverty line and 36 percent of children and more than 2 crore people suffer from malnutrition, zakat can be an effective instrument for poverty alleviation. However, it is necessary to keep in mind the philosophy behind zakat when we collect and distribute it. As prominent Islamic scholar Dr Mokhter Ahmed rightly said: “Paying zakat to make sustainable change in society is its true theme. We must remember this theme while practising it, otherwise our practice may go in vain.”

The writer can be contacted at shahnawaz.khan@thedailystar.net