Rate of Zakah during Ramadan
Q. How was the rate of 2.5 per cent fixed as the rate of zakah? I feel that it is too small. Moreover, a millionaire who pays 2. 5 per cent will remain a millionaire after the payment of his zakah liability, while there are several Quranic verses which warn against hoarding money without spending it for charity. Please comment.
A. The rate of zakah is fixed by Allah himself. It is true that we do not find a Quranic verse which tells us about the rate of zakah with regard to any type of property, but we also do not find the details of prayer in the Quran. In both situations, the Prophet (Pbuh) has given us detailed guidance. It is true that in most cases, the rate of zakah is 2.5 per cent, but this is not applicable to everything. There are certain types of property where the rate of zakah is 5 or 10 per cent. For example, the produce of agricultural land which relies totally on rain for irrigation and the owner does not need to do any work, whatsoever in respect of its irrigation, carries a zakah rate of 10 per cent. Here the rate is high because there is little work. Where irrigation is partly done by machine and partly by rain, the rate is 5 per cent. Moreover what is taken out from the earth, such as minerals and treasures has an even greater rate which is 20 per cent. This is known as rikaz. The reader mentions that a wealthy person who pays only 2.5 per cent will remain wealthy. And so will he. But what of that? The point of zakah is not to deprive the rich of the means of enjoying what Allah has given them. The point is to ensure a decent minimum for everyone so that no one in society is forced to go hungry. As for the verses of the Qur’an and the Hadiths concerning the prohibition of any hoarding or treasuring of money, they apply to any money where the zakah has not been paid. Once a Muslim has paid his zakah, he has discharged his minimum duty. The description of hoarding cannot apply to him.