In Islam, Quran terms the minimum obligatory charity as Zakat or Zakah. Its Arabic root means to increase, grow, flourish, thrive, purify. The meaning embedded in the term indicates that the charity of Zakat will lead to the welfare and progress of the society. The giver will flourish and thrive. His conscious will be purified that he has fulfilled at least his minimum duty to his fellow beings.
Zakat is not paid on income. Zakat is paid on the wealth that is more than a minimum amount and that is not in circulation and sits idle for a whole year unused. Islam wants resources to circulate among people so that their benefit is shared in the society, both among the affluent and the constrained. Zakat forces people to put a portion of their saved wealth into circulation among the needy every year.
Islam does not forbid earning wealth. Islam also does not forbid to save for economic security. But if the saved wealth over a minimum limit sits idle for over a year, 2.5% of it must be paid in Zakat. The remainder of the savings remain to accept additional savings to grow, resulting in a distribution of a larger 2.5% share among the needy in the society the following year. As the saved wealth and the future savings of a person increase, its benefit to the needy in the society multiplies every year to come.
Obligating the payment of Zakat every year, Islam establishes a system to put idle wealth into circulation for the benefit of the constrained in the society, as described in the Holy Quran,
“The alms are only for the poor and the needy, and for those employed in connection therewith, and for those whose hearts are to be reconciled, and for the freeing of slaves, and for those in debt, and for the cause of Allah, and for the wayfarer—an ordinance from Allah. And Allah is All-Knowing, Wise” (9:60).
Poor is the one who is not able to meet his expenses with his personally earned income and needs help from others to balance his budget, as described in the Holy Quran.
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“These alms are for the poor who are detained in the cause of Allah and are unable to move about in the land. The ignorant man thinks them to be free from want because of their abstaining from begging. Thou shalt know them by their appearance; they do not beg of men with importunity. And whatever of wealth you spend, surely, Allah has perfect knowledge thereof” (2:273/274). This verse warns the authorities to examine the condition of the people while distrusting charity and not let their decisions be affected by the intensity of the lobbying and advocacy.
How true, “Never shall you attain to righteousness unless you spend out of that which you love; and whatever you spend, Allah surely knows it well” (3:92/93)!