Continuing with last week’s topic on what is moderation in Islam, and in the same context of being neither stingy nor extravagant, Allah, the Most Exalted, provides an excellent guidance in Sura Al Isra Verse 29 which is also known as the golden principle:
“And do not make your hand [as] chained to your neck or extend it completely and [thereby] become blamed and insolvent.”
This verse expresses avoiding both extremes and to remain astute so as to know where to draw the line. Although generosity is encouraged in Islam, some scholars say that in addition to admonishing the extravagance, ‘extending the hand’ also refers to not doling out everything you have to the extent that you become impoverished yourself and make the dependants suffer.
In other words, you should act in a balanced manner so that you should not hesitate to spend money wherever it should be spent, and at the same time refrain from becoming spendthrifts or overgenerous which may lead to financial trouble for yourself.
I had explained in my articles on the United Nations Development Programme (UNDP)’s SDG 1 (No Poverty) about the obligatory charity named Zakat which requires every sane and adult Muslim to close his or her personal balance sheet on a fixed Islamic date chosen by him or her to be able to ascertain the extent of wealth he or she possesses.
To refresh the understanding in simple terms, if the wealth is equal to or greater than that day’s market value of 87.48 grams (three oz) of gold or 612.36 grams (21 oz) of silver, the person shall be liable to take out 2.5% of the total value of the wealth.
This Zakat amount can be handed to any person out of the eight categories mentioned in the Quran. However, it is preferable that the Zakat amount should first be applied to help a deserving relative since you will be aware of his or her plight.
A question arises: if there is a high degree of poverty in a community, will the wealthy people be exonerated by paying only 2.5% of their wealth annually? There is a possibility that despite the people calculating and paying the Zakat amount diligently, there remains poverty. In such a situation, the Zakat-paying people can exceed the 2.5% threshold voluntarily since this percentage is not ‘cast in stone’ but a minimum requirement.
I have witnessed people even paying up to 5–6% annually of Zakat year after year and become richer since they believe in Verse 39 of Sura Saba (Queen Sheba) which translates to: “And whatever you spend in charity, He will compensate you for it. For He is the Best Provider.”
Returning to SDG 2 (Zero Hunger), Islam provides flexibility for payment of Zakat in kind too. For example, a foodstuff trader can distribute grain items such as wheat, rice or cereal, etc, to the needy instead of cash, provided he does not apply the selling price while converting the Zakat amount into a quantity of grain and honestly takes into consideration the landed cost per kilo. In certain situations, it may also be better to pay Zakat in kind since the recipient may misuse the cash payment.
Expanding the subject to the probable solution for hunger, I would now like to discuss a brilliant institution in Islam, which can be effectively utilized to reduce and eliminate hunger and which could also be a great tool for food security that some of the OIC countries are vying to achieve. This is called Ushr.
The simplest definition of Ushr could be that it is Zakat on land produce and its origin is found in Verse 267 of Sura Al Baqara (chapter named ‘The Cow’). I quote below the verse:
“O Believers! Spend (in the Way of Allah) out of the good things you have earned and out of what We have produced for you from the earth, and choose not for your spending the bad things such as you yourselves would not accept or accept only by overlooking its defects. Know well that Allah is All-Munificent (generous), Most Praiseworthy”.
As the name suggests in Arabic, it is applied as one-tenth or 10% of the end product, for example, when the farmer has reaped the crop and collected the produce from the earth or plucked the fruits in the case of an orchard. Unlike Zakat, Ushr does not have a holding period and is required to be immediately separated for giving away to the poor and needy upon recovery of the produce.
As also evident from the said verse, the Ushr must not contain the rotten part of the crop or foul fruits. The principle here is that you give away the goods under Ushr what you yourself would like to receive. Obviously, no one would want to accept damaged goods, especially when it comes to foodstuff.
These are the following exemptions on the application of Ushr:
1. If the produce is less than a certain quantity. Some scholars have estimated this threshold to be 1000 kg in modern terms since they believe any production below this range may not be profitable for the producer.
2. Ushr is only applicable on the non-perishable produce of the earth such as wheat, rice, barley and other grains and the fruits that can be stored for some time such as olives, dates, sugarcane, etc.
3. If the owner of the land has tenanted it to the producer, the owner shall not be liable to pay Ushr.
The purpose of this educative series and the article is not to hurt any religious or commercial sentiments either consciously or even unwittingly.
Sohail Zubairi is an Islamic finance specialist, AAOIFI-certified Shariah advisor and auditor as well as CIAE-certified Islamic arbitrator and expert. He can be contacted at [email protected].
Next week: Discussion on Ushr to continue.