purayiap
UNEQUAL OPPORTUNITIES AND COMPARISON BETWEEN THEORY OF SUPLUS VALUE & ISLAMIC LAW OF SURPLUS INCOME
By P.P. Abdul Razak
After putting the checks and balances through the strict laws and moral prescriptions related to earning and acquisition of the wealth which help to avoid the accumulation and concentration of the wealth within the certain sects of the society, Islam pays its attention to the balanced distribution of wealth among all. Islam sees that the main and root cause of the economic problems of the world lies in the unjust and lopsided distribution of wealth and its concentration within the rich and the elite class of the world. While describing the mode of distribution of the spoils and booties of the war , Holy Quran says its motto and goal with respect to wealth is creation of a social situation where the circulation of the wealth is not limited among the elite and the rich only.
How far Islam has gone in decentralizing the wealth is well epitomized in its law of inheritance. We see in it the most scientific equation and balancing between rights and responsibilities. Taking into account of responsibilities and obligations of the kith and kin towards the deceased and his /her off-springs, Islam distributes the wealth of the deceased person among many using the most scientific scaling and balancing system and thereby prevents the centralization of the wealth in a person and accelerates its decentralization.
The capital stone of the most important and fundamental approach of decentralization of wealth in Islam is its Law of Surplus Income. When we compare this law with the Marxian theory of Surplus Value, we might be able to understand from which angles Islam and Marxism look into the subject and how do they look into. I am comparing Quranic Law of Surplus Income which works as basis of Zakat with the Marxian theory of surplus value only because it is the only theory available and worth of comparison in this respect. Moreover, you will find how glittering and feasible is the Quranic Law of Surplus income from the background of Marxian theory .
When a raw material becomes a finished product, the finished product acquires more value than the raw materials. This added value is called surplus value. The reason and basis for this surplus value is the strain and efforts put and paid by the laborer . So, Marxian theory of Surplus Value claims that the added value of the finished goods is completely entitled to the laborer who puts his efforts into the raw material. For example, when the wooden logs take form of a table, the difference between the prices of wooden log and the table is the surplus value. The surplus value is the result of the pains of the laborer who worked hard to change it into a table. Hence, he is the only one who has got the right to surplus value.
Before I compare this theory with the Quranic Law of Surplus Income, I would like to bring into the notice of the readers some elements that Karl Marx missed to take note of it.
1. Marx related the value of the product only to the labor or to the proportion of the labor put into the raw material . In fact, in our real life, it is not necessary for a finished product to acquire added value only because of the labor put into it. Neither it is necessary for a finished product to acquire added value in proportion to the labor put into it. The value of the finished good may not decrease only because of less labor . Instead of relating the labor with the value of the finished good and freeing labor from the clutches of the price of the product which is subject to the market mechanism, Islam asks the respective parties to determine the reward of the labor by mutual consent between the owner of the capital and the laborer and relates the reward of the labor with that mutually agreed upon contract between both parties. Furthermore, Islam asks the owner of the capital to pay the reward of the labor even before drying up his sweat or even before the completion of the contractually agreed upon period irrespective of the price and value of the finished product, surplus or deficit value it may have, and irrespective of the fact if the finished product is sold or not since Islam clearly knows that the price of the product conspicuously depends upon the market’s supply demand mechanism too. It is natural for the price of the finished good, whatever be its quality, to go down if the supply of it in the market is more than its demand. But this should not affect the mutually agreed reward of the labor. Sometimes the finished good may not get even the value of the raw materials. In some cases, it may become a dead stock. Marxian theory does not make it clear how such situations of deficit value will affect the reward of the labor. From Islamic perspective, whatever be the situation, surplus or deficit, the reward of the labor is to be mutually determined independently and apart from the value of the finished good. If the mutual agreement between the labor and the capital owner is to relate the reward to the value of the finished good and to share the surplus value as per the agreed upon proportion, Islam does not oppose it and says that both the owner of the capital and the labor will share both profit and loss. If the finished good has surplus value, they will share the surplus as per their agreement and if the finished good has deficit value, the capital owner will bear the loss in terms money and the laborer will bear the loss in terms of labor also.
2. Marxian theory of Surplus value is applicable in the production and manufacturing sectors. It is not relevant and cannot be applied to the service sectors. For example, it does not cover the income of the doctor who treats his patients.
3. Marxian Surplus value theory does not cover other sects of the society other than proletariat and the owner of the capital. For example, the people who are facing difficulties in meeting the two ends of their life on the account of they do not get the job, despite their worthiness and qualification, because of the intense competition in job market and the limited opportunities, or the people who are suffering because they have been unable to acquire enough education and/or qualification to earn a job, do they have any right in the income of the laborers and capital owners who thrive making use of the same opportunities which are denied to others who suffer? The poor, the needy and the deprived are those who suffer because of lack of job opportunity for historical and/or sociological and/or natural reasons. Or they may have become unable to work because of physical disability or handicap. Or they have become poor because the limited opportunity has been denied to them. The rich got the opportunity to acquire wealth only at the cost and expense of the weaker sections of the society who were denied the same opportunity. Is there any dues and rights for the suffering class and the weaker sections of the society who were denied the opportunity because of the reasons mentioned above in the surplus wealth of the rich who thrive exploiting the same opportunities ? Marxian theory is most silent on this part while the Islamic law of surplus income is most vocal here. Moreover, Islam, elaborating the right of Zakat, becomes a unique fusion of law and love, a kind of assimilation of force and mercy. Morally it is a kind of service and sacrifice on the part of the rich. But at the same time, legally and jurisprudentially, it is a kind of opportunity tax levied upon the rich in terms of the right of the deprived class in their surplus wealth.
4. Karl Marx who does not agree with the capitalist concept of private property ownership and who nor does agree with representational rights of the trustee on the wealth as Islam does, does not determine the role of the capital in the potential surplus value of the finished good. On the contrary, Islam gives the due rights to the trustee of the capital also looking into it from the perspective of representation .
5. Marx, as a human being, could not foresee the mechanization going to take place in the fields of production tools. So, the surplus value theory became unable to tackle and put up with the situation of conspicuous replacement of the human labor by the machines of the capital owners .
From Quranic perspective, the law of surplus income is the basis of Zakat. The law of surplus income by definition is the wealth a person acquires through a lawful job he does and/or through inheritance after meeting his basic necessities and basic necessities of persons he is liable to take care by law for a period of one year. Holy Quran unequivocally and clearly says repeatedly that the people who suffer from poverty because of the denial of the opportunity for various reason and the people who have been given semi-opportunity but which does not suffice to make the both ends of their life meet have got right in the surplus income of others. This law correlates and corroborates with the social facts. Though opportunity is one of the blessings of Allah, it is created through the agency of the society and is limited. Even though everybody is equal in front of opportunity to seize it , they become unequal when it is availed or seized upon. Some thrive upon its seizure while others who are denied do suffer. So, the rich thrives at the cost of the deprived. Everybody cannot become doctors or engineers. It is not only a matter of limitation of opportunity, but impractical also. That’s why we do develop a filtering process to select. Nor all of us can become business men and that also is not feasible in our real life. So, Quran says those who are unable to meet the two ends of life and suffer due to deprival of the opportunity have got a certain right in the surplus income of those who are able to thrive due to their seizure of the same opportunity.
“ In their surplus income there is due right for the needy (the people who have been given opportunity but which does not suffice to make the both ends of their life) and for those who have been denied ( all kinds of opportunities for various reasons and thereby become poor and the deprived)” . (Holy Quran: 51:19). In the eighth verse of Chapter 70, we see Holy Quran repeating the same.
The Arabic word “maal” in these verses have been interpreted as “surplus income” taking into consideration of the word “needy” ( Arabic word “sael”) mentioned afterwards in the same verses. The following things can be understood from these verses:
The needy (“sael”) who struggles to make both ends of his life meet has no surplus income ( “maal”) with him and one who has got surplus income ( maal”) does not belong to the class of the needy who struggles to survive. So, “maal” in this context from Quranic perspective means surplus income after meeting the basic necessities of the life. This concept is supported and substantiated by the prophet’s saying of “Zakat is taken from the rich and distributed among the deprived”. The measuring rod in terms of economic period to calculate this surplus income is and should be the same taught by the prophet ( PBUH) .
The trustees of the surplus income were able to get hold of it because of the opportunities made available to them by the society. These opportunities were availed by them at the expense of those who have been denied the same opportunities for various reasons. So, the deprived classes have got due right in others’ surplus income.
CHARACTERISTICS OF ISLAMIC LAW OF SURPLUS INCOME
The main characteristic features of the Islamic Law of Surplus Income are the following:
1. Islam is not ready to leave the weaker sections of the society for the market competition sitting passively and looking into their problems indifferently. It knows and understands that they have been denied the equal opportunities for various historical, social and natural reasons. It perceives why they have become unable to make both ends of their life meet. Quite different from the cruel and brutal capitalistic methods of making the weaker, the deprived and the backward classes of the society scapegoats of the intense competition by blatant misappropriation of the theory of survival of the fittest in the socio-economic realms which originally was expounded by Charles Darwin only in the areas of origin of species and their existence, Islam approaches the problem from humanitarian level. Islam recognizes the competition and understands it as the wheel of the civilization as well. At the same time, it does not want to ignore the weaker sections who have been pushed back in the intensive competition by and between the well to do competitors as well. So, it has determined certain rights for such weaker classes in the surplus income of the rich and forward classes of the society. Quran is the only book in the world which promulgates that “ there is no restriction on the blind, the lame and the sick ( and the like of any handicapped who cannot work as an ordinary person) if they eat from any house as it is their right.” ( 24:61).
2. Law of Surplus income, unlike Marxian Surplus value theory, is not solely dependent on the price of the finished product. On the contrary, it evaluates a person’s economic status using the measuring rods of both income and the time period. Through this, Islam says that it is the obligation of the trustees of the surplus income to provide the needy and the poor to meet their basic necessities of the life and Islam requires the state makes its own responsibility to ensure the protection of such rights. By fixing one year time period for calculation of the surplus income, Islam wants to take into consideration of short and long term economic problems of the trustees of the surplus income while assessing his/her economic status.
3. The Law of Surplus Income does not leave the right of the deprived to the market fluctuations or supply-demand mechanism. Islam wants to assert and establish the rights of the deprived independent of the market mechanism and over and beyond it.
4. The Law of Surplus Income is not related to rewards of the laborers and their rights only. It does not see the wealth as a problem only between the capitalist and the laborers. On the contrary, the Law of Surplus Income views the society from three levels In order to categorize the three, I am taking liberty to coin some words with its definitions. The Needy ( those who cannot make both ends of their life meet), The Meety (those whose income is just sufficient to meet their requirements of life) and the Addy (those who holds additional and surplus income after meeting their requirements of life). Islam through this categorization accommodates the poor and the destitute, the orphans and the impoverished, the deprived and disabled and those sects of the people who have been pushed back in to the doldrums of life because of social, historical and physical reasons and determines their right in the properties of the rich.
5. The right of the deprived in the surplus income of the rich will be distributed annually. It won’t be completed by giving it out once in a life.
6. The Law of Surplus Income does not discourage acquisition of wealth and becoming its trustees. On the contrary, it works as an additive and a catalyst in converting the saving into the investment. The rich who gives out the right of the deprived in their property every year cannot help thinking of channeling their saving into a kind of productive investment. This has to be looked upon from another angle also that Islam prohibits interest as well. The right of the deprived in the surplus income of the rich together with the prohibition of interest works as an effective catalyst in turning the saving into the investment and generating thereby the economic growth both in its micro and macro levels. Interest, apart from being a moral graveyard, is a dead end of an economic transaction whereas each and every economic transaction which Islam has made lawful ensures various streams of value chains and long cycles of diverse economic transactions. Apart from prohibiting the commoditization of money and renting it thereof which has no intrinsic and inherent utility entailing from its entity itself, Islam sees it abhorrent to extract any thing additional on a lent and loaned ( same thing given and taken back) thing since it does not create any other economic opportunity for anybody other than the lender while bartering and/or buying a thing ( exchange of money or some thing with something else) creates long cycle of economic opportunities for the supplier of the raw materials, manufacturer, distributor, transporter, trader and buyer. Each of these clients has got its own cycles of economic transactions as well.
Both in principle and practice, Zakat is the right of the deprived in the surplus income of the rich. This is the one of the most important, strict and strong measures Islam adopts to ensure just and balanced distribution of the wealth among the people. It is the canal that has been dug in order to channel the flow of the wealth from the rich to the poor. But, we have to understand that in Islam, Zakat is not the only mean to realize this goal. As we have mentioned earlier, Zakat is the corner stone among its laws related to the definition of relationship between the individual and the property, its rules and regulations related to the distribution of land, its prohibition of interest and usury, its setting of checks and balances in an entity’s acquisition of wealth, its law of inheritance, its other laws related to economic transactions and the power it gives to the state to confiscate the surplus wealth of the rich in the event of the state sees it inevitable ect. Moreover, Islam has got social welfare and security schemes like Wakf and as mentioned earlier it gives unrestricted right to socio-economic security for the handicapped and the sick.
The Holy Quran once more makes it clear by elaborating the seven sects of the society who are entitled for Zakat. If we study those seven sects of the people deeply, we will understand that Zakat cannot be utilized in the developmental works of which both haves and have-nots are common beneficiaries of it. But it says zakat has to be utilized for the upliftment of the backward and the weaker sections of the society. For meeting the expenditure of governance and developmental works, government may levy other service taxes on its citizenry. Zakat is never tantamount to the service tax payable to the government and the one won’t stand instead of the other. For collection of Zakat, Islam uses both the means of piety and the force of the power. The Hereafter life awareness of the believers itself will work as a motivational factor in giving Zakat correctly and punctually. But, this cannot be expected from all. During the reign of Abu Bakr, when a sect of the people refused to give the Zakat, Abu Bakr encountered it using force. This makes it clear that, like all other socio-cultural and political laws, the power is indispensable for full and complete implementation of Islamic economic laws also. In addition to it, political and economic approaches of a comprehensive ideology of life cannot move into different poles. It is impossible to have an economic philosophy without a political philosophy. The economic philosophy of Islam is complementary to its political philosophy.
By P.P. Abdul Razak
After putting the checks and balances through the strict laws and moral prescriptions related to earning and acquisition of the wealth which help to avoid the accumulation and concentration of the wealth within the certain sects of the society, Islam pays its attention to the balanced distribution of wealth among all. Islam sees that the main and root cause of the economic problems of the world lies in the unjust and lopsided distribution of wealth and its concentration within the rich and the elite class of the world. While describing the mode of distribution of the spoils and booties of the war , Holy Quran says its motto and goal with respect to wealth is creation of a social situation where the circulation of the wealth is not limited among the elite and the rich only.
How far Islam has gone in decentralizing the wealth is well epitomized in its law of inheritance. We see in it the most scientific equation and balancing between rights and responsibilities. Taking into account of responsibilities and obligations of the kith and kin towards the deceased and his /her off-springs, Islam distributes the wealth of the deceased person among many using the most scientific scaling and balancing system and thereby prevents the centralization of the wealth in a person and accelerates its decentralization.
The capital stone of the most important and fundamental approach of decentralization of wealth in Islam is its Law of Surplus Income. When we compare this law with the Marxian theory of Surplus Value, we might be able to understand from which angles Islam and Marxism look into the subject and how do they look into. I am comparing Quranic Law of Surplus Income which works as basis of Zakat with the Marxian theory of surplus value only because it is the only theory available and worth of comparison in this respect. Moreover, you will find how glittering and feasible is the Quranic Law of Surplus income from the background of Marxian theory .
When a raw material becomes a finished product, the finished product acquires more value than the raw materials. This added value is called surplus value. The reason and basis for this surplus value is the strain and efforts put and paid by the laborer . So, Marxian theory of Surplus Value claims that the added value of the finished goods is completely entitled to the laborer who puts his efforts into the raw material. For example, when the wooden logs take form of a table, the difference between the prices of wooden log and the table is the surplus value. The surplus value is the result of the pains of the laborer who worked hard to change it into a table. Hence, he is the only one who has got the right to surplus value.
Before I compare this theory with the Quranic Law of Surplus Income, I would like to bring into the notice of the readers some elements that Karl Marx missed to take note of it.
1. Marx related the value of the product only to the labor or to the proportion of the labor put into the raw material . In fact, in our real life, it is not necessary for a finished product to acquire added value only because of the labor put into it. Neither it is necessary for a finished product to acquire added value in proportion to the labor put into it. The value of the finished good may not decrease only because of less labor . Instead of relating the labor with the value of the finished good and freeing labor from the clutches of the price of the product which is subject to the market mechanism, Islam asks the respective parties to determine the reward of the labor by mutual consent between the owner of the capital and the laborer and relates the reward of the labor with that mutually agreed upon contract between both parties. Furthermore, Islam asks the owner of the capital to pay the reward of the labor even before drying up his sweat or even before the completion of the contractually agreed upon period irrespective of the price and value of the finished product, surplus or deficit value it may have, and irrespective of the fact if the finished product is sold or not since Islam clearly knows that the price of the product conspicuously depends upon the market’s supply demand mechanism too. It is natural for the price of the finished good, whatever be its quality, to go down if the supply of it in the market is more than its demand. But this should not affect the mutually agreed reward of the labor. Sometimes the finished good may not get even the value of the raw materials. In some cases, it may become a dead stock. Marxian theory does not make it clear how such situations of deficit value will affect the reward of the labor. From Islamic perspective, whatever be the situation, surplus or deficit, the reward of the labor is to be mutually determined independently and apart from the value of the finished good. If the mutual agreement between the labor and the capital owner is to relate the reward to the value of the finished good and to share the surplus value as per the agreed upon proportion, Islam does not oppose it and says that both the owner of the capital and the labor will share both profit and loss. If the finished good has surplus value, they will share the surplus as per their agreement and if the finished good has deficit value, the capital owner will bear the loss in terms money and the laborer will bear the loss in terms of labor also.
2. Marxian theory of Surplus value is applicable in the production and manufacturing sectors. It is not relevant and cannot be applied to the service sectors. For example, it does not cover the income of the doctor who treats his patients.
3. Marxian Surplus value theory does not cover other sects of the society other than proletariat and the owner of the capital. For example, the people who are facing difficulties in meeting the two ends of their life on the account of they do not get the job, despite their worthiness and qualification, because of the intense competition in job market and the limited opportunities, or the people who are suffering because they have been unable to acquire enough education and/or qualification to earn a job, do they have any right in the income of the laborers and capital owners who thrive making use of the same opportunities which are denied to others who suffer? The poor, the needy and the deprived are those who suffer because of lack of job opportunity for historical and/or sociological and/or natural reasons. Or they may have become unable to work because of physical disability or handicap. Or they have become poor because the limited opportunity has been denied to them. The rich got the opportunity to acquire wealth only at the cost and expense of the weaker sections of the society who were denied the same opportunity. Is there any dues and rights for the suffering class and the weaker sections of the society who were denied the opportunity because of the reasons mentioned above in the surplus wealth of the rich who thrive exploiting the same opportunities ? Marxian theory is most silent on this part while the Islamic law of surplus income is most vocal here. Moreover, Islam, elaborating the right of Zakat, becomes a unique fusion of law and love, a kind of assimilation of force and mercy. Morally it is a kind of service and sacrifice on the part of the rich. But at the same time, legally and jurisprudentially, it is a kind of opportunity tax levied upon the rich in terms of the right of the deprived class in their surplus wealth.
4. Karl Marx who does not agree with the capitalist concept of private property ownership and who nor does agree with representational rights of the trustee on the wealth as Islam does, does not determine the role of the capital in the potential surplus value of the finished good. On the contrary, Islam gives the due rights to the trustee of the capital also looking into it from the perspective of representation .
5. Marx, as a human being, could not foresee the mechanization going to take place in the fields of production tools. So, the surplus value theory became unable to tackle and put up with the situation of conspicuous replacement of the human labor by the machines of the capital owners .
From Quranic perspective, the law of surplus income is the basis of Zakat. The law of surplus income by definition is the wealth a person acquires through a lawful job he does and/or through inheritance after meeting his basic necessities and basic necessities of persons he is liable to take care by law for a period of one year. Holy Quran unequivocally and clearly says repeatedly that the people who suffer from poverty because of the denial of the opportunity for various reason and the people who have been given semi-opportunity but which does not suffice to make the both ends of their life meet have got right in the surplus income of others. This law correlates and corroborates with the social facts. Though opportunity is one of the blessings of Allah, it is created through the agency of the society and is limited. Even though everybody is equal in front of opportunity to seize it , they become unequal when it is availed or seized upon. Some thrive upon its seizure while others who are denied do suffer. So, the rich thrives at the cost of the deprived. Everybody cannot become doctors or engineers. It is not only a matter of limitation of opportunity, but impractical also. That’s why we do develop a filtering process to select. Nor all of us can become business men and that also is not feasible in our real life. So, Quran says those who are unable to meet the two ends of life and suffer due to deprival of the opportunity have got a certain right in the surplus income of those who are able to thrive due to their seizure of the same opportunity.
“ In their surplus income there is due right for the needy (the people who have been given opportunity but which does not suffice to make the both ends of their life) and for those who have been denied ( all kinds of opportunities for various reasons and thereby become poor and the deprived)” . (Holy Quran: 51:19). In the eighth verse of Chapter 70, we see Holy Quran repeating the same.
The Arabic word “maal” in these verses have been interpreted as “surplus income” taking into consideration of the word “needy” ( Arabic word “sael”) mentioned afterwards in the same verses. The following things can be understood from these verses:
The needy (“sael”) who struggles to make both ends of his life meet has no surplus income ( “maal”) with him and one who has got surplus income ( maal”) does not belong to the class of the needy who struggles to survive. So, “maal” in this context from Quranic perspective means surplus income after meeting the basic necessities of the life. This concept is supported and substantiated by the prophet’s saying of “Zakat is taken from the rich and distributed among the deprived”. The measuring rod in terms of economic period to calculate this surplus income is and should be the same taught by the prophet ( PBUH) .
The trustees of the surplus income were able to get hold of it because of the opportunities made available to them by the society. These opportunities were availed by them at the expense of those who have been denied the same opportunities for various reasons. So, the deprived classes have got due right in others’ surplus income.
CHARACTERISTICS OF ISLAMIC LAW OF SURPLUS INCOME
The main characteristic features of the Islamic Law of Surplus Income are the following:
1. Islam is not ready to leave the weaker sections of the society for the market competition sitting passively and looking into their problems indifferently. It knows and understands that they have been denied the equal opportunities for various historical, social and natural reasons. It perceives why they have become unable to make both ends of their life meet. Quite different from the cruel and brutal capitalistic methods of making the weaker, the deprived and the backward classes of the society scapegoats of the intense competition by blatant misappropriation of the theory of survival of the fittest in the socio-economic realms which originally was expounded by Charles Darwin only in the areas of origin of species and their existence, Islam approaches the problem from humanitarian level. Islam recognizes the competition and understands it as the wheel of the civilization as well. At the same time, it does not want to ignore the weaker sections who have been pushed back in the intensive competition by and between the well to do competitors as well. So, it has determined certain rights for such weaker classes in the surplus income of the rich and forward classes of the society. Quran is the only book in the world which promulgates that “ there is no restriction on the blind, the lame and the sick ( and the like of any handicapped who cannot work as an ordinary person) if they eat from any house as it is their right.” ( 24:61).
2. Law of Surplus income, unlike Marxian Surplus value theory, is not solely dependent on the price of the finished product. On the contrary, it evaluates a person’s economic status using the measuring rods of both income and the time period. Through this, Islam says that it is the obligation of the trustees of the surplus income to provide the needy and the poor to meet their basic necessities of the life and Islam requires the state makes its own responsibility to ensure the protection of such rights. By fixing one year time period for calculation of the surplus income, Islam wants to take into consideration of short and long term economic problems of the trustees of the surplus income while assessing his/her economic status.
3. The Law of Surplus Income does not leave the right of the deprived to the market fluctuations or supply-demand mechanism. Islam wants to assert and establish the rights of the deprived independent of the market mechanism and over and beyond it.
4. The Law of Surplus Income is not related to rewards of the laborers and their rights only. It does not see the wealth as a problem only between the capitalist and the laborers. On the contrary, the Law of Surplus Income views the society from three levels In order to categorize the three, I am taking liberty to coin some words with its definitions. The Needy ( those who cannot make both ends of their life meet), The Meety (those whose income is just sufficient to meet their requirements of life) and the Addy (those who holds additional and surplus income after meeting their requirements of life). Islam through this categorization accommodates the poor and the destitute, the orphans and the impoverished, the deprived and disabled and those sects of the people who have been pushed back in to the doldrums of life because of social, historical and physical reasons and determines their right in the properties of the rich.
5. The right of the deprived in the surplus income of the rich will be distributed annually. It won’t be completed by giving it out once in a life.
6. The Law of Surplus Income does not discourage acquisition of wealth and becoming its trustees. On the contrary, it works as an additive and a catalyst in converting the saving into the investment. The rich who gives out the right of the deprived in their property every year cannot help thinking of channeling their saving into a kind of productive investment. This has to be looked upon from another angle also that Islam prohibits interest as well. The right of the deprived in the surplus income of the rich together with the prohibition of interest works as an effective catalyst in turning the saving into the investment and generating thereby the economic growth both in its micro and macro levels. Interest, apart from being a moral graveyard, is a dead end of an economic transaction whereas each and every economic transaction which Islam has made lawful ensures various streams of value chains and long cycles of diverse economic transactions. Apart from prohibiting the commoditization of money and renting it thereof which has no intrinsic and inherent utility entailing from its entity itself, Islam sees it abhorrent to extract any thing additional on a lent and loaned ( same thing given and taken back) thing since it does not create any other economic opportunity for anybody other than the lender while bartering and/or buying a thing ( exchange of money or some thing with something else) creates long cycle of economic opportunities for the supplier of the raw materials, manufacturer, distributor, transporter, trader and buyer. Each of these clients has got its own cycles of economic transactions as well.
Both in principle and practice, Zakat is the right of the deprived in the surplus income of the rich. This is the one of the most important, strict and strong measures Islam adopts to ensure just and balanced distribution of the wealth among the people. It is the canal that has been dug in order to channel the flow of the wealth from the rich to the poor. But, we have to understand that in Islam, Zakat is not the only mean to realize this goal. As we have mentioned earlier, Zakat is the corner stone among its laws related to the definition of relationship between the individual and the property, its rules and regulations related to the distribution of land, its prohibition of interest and usury, its setting of checks and balances in an entity’s acquisition of wealth, its law of inheritance, its other laws related to economic transactions and the power it gives to the state to confiscate the surplus wealth of the rich in the event of the state sees it inevitable ect. Moreover, Islam has got social welfare and security schemes like Wakf and as mentioned earlier it gives unrestricted right to socio-economic security for the handicapped and the sick.
The Holy Quran once more makes it clear by elaborating the seven sects of the society who are entitled for Zakat. If we study those seven sects of the people deeply, we will understand that Zakat cannot be utilized in the developmental works of which both haves and have-nots are common beneficiaries of it. But it says zakat has to be utilized for the upliftment of the backward and the weaker sections of the society. For meeting the expenditure of governance and developmental works, government may levy other service taxes on its citizenry. Zakat is never tantamount to the service tax payable to the government and the one won’t stand instead of the other. For collection of Zakat, Islam uses both the means of piety and the force of the power. The Hereafter life awareness of the believers itself will work as a motivational factor in giving Zakat correctly and punctually. But, this cannot be expected from all. During the reign of Abu Bakr, when a sect of the people refused to give the Zakat, Abu Bakr encountered it using force. This makes it clear that, like all other socio-cultural and political laws, the power is indispensable for full and complete implementation of Islamic economic laws also. In addition to it, political and economic approaches of a comprehensive ideology of life cannot move into different poles. It is impossible to have an economic philosophy without a political philosophy. The economic philosophy of Islam is complementary to its political philosophy.
