A Study On Basic Philosophical Precepts Of Islamic Economics
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Islamic Economics and Dynamics of Zakat
By P.P. Abdul Razak

Islam postulates its economic philosophy and theory with cosmological orientation. It is a cosmic fact that the universe and all the living and non-living beings in it obey inviolable laws of its Creator. So, Islam demands human being to be in communion with the mainstream of the nature and the universe by surrendering voluntarily his will to the will and law of God in the realms of the life where he enjoys freedom. This is how Islam is defined in a nutshell. Both the term Khalifa (Vicegerent) coined by Holy Quran in order to define and describe human being’s status and position in this world and the word Khilafat ( Vicegerency) used to introduce Islamic socio-political and economic system symbolize the necessity of unconditional obedience only to Allah and compliance with His laws and precepts. This terminology of Vicegerent (Khalifa) implies the obedience of human being to Allah as a person, a society and a state in terms of his status as vicegerent of Allah and it corresponds to the very definition of Islam and is complementary to it. It is the same terminology of vicegerency that Holy Quran has used in order to define the relationship between human being and God in the realm of property and its acquisition.

From Islamic viewpoint, human being does not have ownership in his property whether it be by the individual or by the society or by the state. This perspective corresponds with the nature of the human life on this planet. Human being does not bring anything with him while he is born and does not take with him anything while he is died. Human being does not have ownership either even on his life or body or soul. How such a being having no ownership in his own being and life can own something which does not even belong to him. So, from Islamic point of view, no individual or society or state does have right of absolute ownership on the property. Islam redefines the relationship between human being and the property from a different level. Let us ponder over the two verses from the Glorious Quran quoted below:

“Believe in Allah and His Messenger ( Mohammad ) and spend of that whereof He has made you trustees ( within your capacity as vicegerent of God on this Planet). ( Holy Quran : 57:7)

This verse implies and includes the following :

1. The real and absolute owner of the property and wealth is Allah who is the Creator and the Owner of the universe and human being itself.
2. Human being does not have a status and/or position different from vicegerency in the realm of his economy also.
3. Human being represents Allah in his economic activities also.
4. So, human being is responsible to obey and comply with Allah’s laws, rules and precepts in the realms of his economic activities as well. The deliberate violation in this regard will be contradictory to the concept of Tawheed ( Monotheism) as defined and described by the Glorious Quran as it implies surrender of will by human being to the will of God.

Look into the second verse from the Glorious Quran:

“ And You should not give unto the foolish your property which Allah has made a means of support for you “. ( Holy Quran 4:5)

This verse implies and includes the following:

1. As far as property is concerned, the human society has got a collective responsibility. The three times repeated plural form of the second person in this verse stands for the society and one who reins its affairs.
2. Property is the basis of survival of human life on this planet . In this respect the entity ( an individual, or a group of individuals or a society) who becomes the trustee of a certain property has got private representational right on it and the power thereof to deal with it accordingly. This will be executed by the respective entity under the strict and the collective supervision of Islamic state or social system.
3. In the event of the privileges of the private representational right violates the basic norms and precepts and upsets the larger social causes, it will necessitate the intervention of Islamic state in order to correct and put it in the right and the straight way so as to serve the larger social goals basically intended by the socio-political and economic system of Islam.

When we corroborate both the verses quoted above and correlate it, the fundamental economic law that can be deducted from it is this: The privileges an entity (an individual, or a group of individuals or a society) does have on the property it deals with it is that of a trustee under the strict and collective supervision of the society and the state.

Economic Law of Islam:

Human Being and Nature

From Islamic perspective, everything is rich and abundant in this world. This is so obvious and plain for any beholder. Even though human being is the epi-centre among the millions of genres of species on this planet , he is neither the biggest of all species, nor with the largest numbers, nor with the longest span of life, nor the first ring in the long chain of living species. The number of a particular kind of colorful birds of passage that flee from the southern part of America to Mexico at the advent of the month of December is 140 million. This is not the only kind of bird of passage from America. This is the number of birds that passes at the advent of December to Mexico from that forest only. There are birds that stays in America itself. There are other birds in northern, eastern and western parts of America also. In summary we can be sure that the number of birds in America is much more than that of its human population. Think about the fishes in the deep waters. The number of single kind of a fish itself will be much more than the number of human population on this planet. Ponder over the different kinds and huge sizes of the water creatures. Do we observe any kind of dearth or deficit in their food that threatens even their existence and survival? Look into the two Quranic verses which point towards this fact:

“ And so many a moving (living) creature there is, that carries not its provision! Allah provides for it and for you”. ( Holy Quran 29: 60)

The quintessence of this verse is that since Allah is the provider for both human being and all other species on this planet, how the nature can be scarce and impoverished for human being only while it is affluent, opulent and abundant for all other species?!

Another Quranic verse mentions that the provision of food to all the species including human being for its existence and survival as Allah’s responsibility :

“And no moving or living creature is there on earth but its provision is due from Allah. And He knows its dwelling place and its deposit ( in the uterus, grave ect). ( Holy Quran 11:6)

The prophet ( PBUH) said looking at the birds nuzzling at the dusk : “ behold, they went at dawn with empty tummies. They came back to their nests at dusk with the overflowing bellies”.

As far as an observer is concerned, it may be a paradox to see the nature so abundant for all those species, either only herbivorous or only carnivorous and with very limited means while it is depicted so scarce, impoverished and insufficient for human beings, the only omnivorous creature on this planet, who consumes all those species and flora and fauna as his resources. In fact, human being simply finds fault with the nature and its Creator for his own mismanagement and malpractices. Human being occupies only 23% of earth space with other creatures which he consumes along with the 77% of the vast resources from the water as well.

Now consider the phenomena of air and sunlight which are indispensable for the very existence and continuity of human life on this planet and at the same time are beyond the realm of human management. Do we experience any kind of dearth or scarcity in it? Have we ever encountered such a scarcity in human history? If not, it is the same God who has provided us air and sunlight that has set this earth as our living planet and provided us other resources also. So, there doesn’t arise the problem of the earth and its resources not meeting with the needs and requirements of the humanity provided the human being complies with the laws, rules and precepts of Allah, the provider of the air and the sunlight, in all the fields and realms of life where he enjoys the freedom. Human being should admit the fact that source of his guidance is the same that of wonderful instincts of other species. Holy Quran uses the word Hidaya (Guidance) both for wonderful instincts of animals and for the divine guidance given to humankind for leading their life in the realms where they enjoy freedom. (Holy Quran 20: 50; 87: 3). It means that the divine guidance given to human being through the prophet is as unique, impeccable, flawless and wonderful as the instincts that human being observes in the animals with so much of amazement and astonishment. Even though it may be different in its nature, the means of instinct in the animals is a kind of inspiration ( wahy in Arabic – Holy Quran: 16:68) . Holy Quran uses the word inspiration (Wahy) for the process pressed into service for giving divine guidance for humankind through the prophets. The philosophy of this parallels is very clear and simple. The authority to give guidance in the realms of life where human being enjoys freedom including his economic life is for the same authority who has given the wonderful instinct to all animals. So, the Islamic system which springs from the divine guidance is as wonderful, unique, impeccable and flawless as animal instincts. It provides the abundance that of the air and transparency that of the sunlight. It is so beautiful, integrated and indivisible as the universe is. Because, it is the human facet of the system of the universe and it is the human system with the visage of the nature.

Islamic Economy & Acquisition of Wealth:

The duty of giving Zakat and taking it with force arises when a person acquires wealth in a certain extent. So, the Islamic economy which focuses on the decentralization of the wealth through various means and balanced distribution of it among the society teaches, even before the ways of distribution and exchange of the wealth, the just and lawful ways of its acquisition.. Zakat is not the name of process of purification of the wealth that has been acquired unlawfully and unjustly. “Tomorrow . in the Hereafter life, no human being’s feet will move ahead in the Divine Court of Allah until he has responded to the five affairs”, Prophet taught the believers. Out of these, there is only one question about four affairs. “ Span of life, what did you with it? Health, What did you do with it? …” But when it comes to the wealth there are two questions that we have to encounter: The first question is: “ Where from and how did you acquire it?” And then comes the second question with regard to the wealth : “ How did you spend it?”. Islam curtails and controls “freedom to” acquire and earn through its moral prescriptions in order to safeguard its citizenry’s “freedom from” exploitation, cheating, deception and looting . It understands that the concept of freedom devoid of right to justice relegates it into a tool for exploitation.

In another prophetic saying prophet describes a person whom the common people consider as “pious” while they see him praying lonely in the desert. He does wear all the features of piety as a mask. Prophet said: “ His water that he drinks has been acquired unlawfully, the food that he eats has also been earned unlawfully and the clothe that he puts on also has been collected unlawfully. Then how his prayers will be accepted ?!” This means that God won’t accept even the prayers from a person provided his socio-economic life is not set in line with the orders, instructions and commandments of God.

Zakat is neither a license to acquire the wealth unlawfully nor a mean to purify the wealth unjustly acquired. Zakat liberates the person from the evil mentality of worship of wealth, avariciousness, greed , jealousy, parsimoniousness, selfishness, narrowness of mind and miserliness and it inculcates in him mentality for sacrifice, generosity, awareness about others rights, social cooperation and philanthropy. Through Zakat, Wakf and other such means Islam wants human beings not to be self-centric . Islam promulgates that economics is not only a matter of science but of morality also. It is as cultural as civilizational. It has got relationship both with technology and spirituality. It needs to be looked upon not only through objective analysis but has to be directed with normative moral prescriptions also. That is why it has been given the name of Zakat which means purification in Arabic. Holy Quran says: “Take sadaqa (zakat) from their wealth in order to purify them and sanctify them with it” (Holy Quran : 9:103). The pronoun “them” in this verse denotes that Zakat purifies the mind and life of the person who gives the Zakat and not the wealth of the Zakat giver. If at all Zakat purifies the wealth, it is only in the sense that Zakat prevents the wealth becoming impure and unclean because of its mixture with others right and dues not given out through Zakat.


Whether it be industries and/or business and/or agriculture and/or any other service areas, the first and preliminary way of earning and acquisition is the labor. As far as a Muslim, who believes that he will be questioned in the hereafter life about the way of earning and acquisition adopted by him in his mundane life, is concerned it is inevitable to asses and evaluate the job and coolie, the first and preliminary source of earning and acquisition, from Islamic perspective. He has to know distinctively about the lawful jobs and the unlawful jobs, the legitimate ways of earning and acquisition of wealth and the illegitimate ways of it. The Question of “How did you acquire your wealth” that Allah would be asking in the Hereafter life would include and would be directly related to what jobs he was doing in his mundane life. So, whatever be features the modern systems may have got or the circumstances the Muslims are in, all kinds of the jobs are not lawful to a Muslim. The running of prostitute dens, gambling centres, liquor bars or jobs directly dealing with interest or any other business that makes lawful of what has been made unlawful by Allah won’t be lawful way of earning and acquisition by any reason and leave alone the simple reason of it has been nationalized by any Government. The argument that we will be going backward again if we are not indulging in these kind of business is baseless. There are so many lawful walks and fields. Front running in those fields itself is sufficient to make us forward both socially and economically. We were leaders of the world while we had held our principle so firmly and our policies were so viable and flexible. Once we started to leave our principles behind us and became rigid in our policies, all the world knows in what a deep precipice the so called Muslim world is right now. And to look into this from another angle, Muslims progress and prosperity is simultaneously related to both his spiritual and mundane life. The so called “progress” in his mundane life cannot be at the expense of his spiritual and thereby hereafter life. The real progress of Muslims, as a person and society, relies upon to what extent he and/or they live in compliance with the law ordained by Allah. The moral as well as material deterioration deepens in proportion to his violation of Allah’s commandments. Holy Quran says: “Thou are the superiors if ye are the true believers” It was so while we were true believers. And it will be so when we become true believers in its fullest sense and spirit.

Islam has got the most lofty and the most sublime vision about labor. Holy Quran and prophetic tradition see the labor as the conspicuous feature of humanity. “ Verily, we created human being to toil” (Holy Quran: 90:4)

“ O Human being, you are toiling towards your Lord and you have to meet your Lord toiling as well” (Holy Quran: 84:6). Holy Quran makes distinction between human being ( being-for-itself) and the universe excluding human being ( being-in-itself) on the basis of responsibility that human being bears on his shoulders. ( Holy Quran 33:72).
Prophet Mohammad ( PBUH) told: “The true believer passes away sweating his forehead ( toiling and perspiring).” At another time prophet said: You work for your hereafter life as if you are going to die tomorrow and you strive for your mundane life as if you are going to live on this earth forever”. A believer in truth when he strives and pays efforts for his livelihood, he works taking into consideration of all the human being yet to come into this world. He considers himself only as a ring in the long chain of humankind. His sight is never limited within himself. He never can be self centric and he never can withdraw into himself and not to consider the humanity. The prophet (PBUH) again taught with regard to coolie of the laborer. “ You give the reward of the laborer before his sweat dries up” . Furthermore, he again taught the employee is equal to the employer as far as food, clothing and housing are concerned. Again he mentioned: “ Don’t force or compel your employee to do what is beyond his limit and capacity. If you ask him to do anything more, help him on it ( by sharing the burden of the work and/or giving other monetary incentives).