Follow Up: Categorizing Salary As Produce
Just an addition: “Service industry , an industry in that part of the economy that creates services rather than tangible objects. Economists divide all economic activity into two broad categories, goods and services. Goods-producing industries are agriculture, mining , manufacturing , and construction; each of them creates some kind of tangible object. Service industries include everything else: banking, communications, wholesale and retail trade , all professional services such as engineering, computer software development, and medicine, nonprofit economic activity, all consumer services, and all government services, including defense and administration of justice. A services-dominated economy is characteristic of developed countries. In less-developed countries most people are employed in primary activities such as agriculture and mining.” – Brittanica Just to demonstrate that things like agriculture, mining, or anything related to the making of actual products is defined as completely distinct from the services industry, and just to reiterate, wholesale and retail trade is also considered a part of the services industry, how come 2.5% annually on them but on salaries 10% everytime? Would love some clarifications. Just because it has become industrialized, I fail to understand how salary is categorized as the same things as agricultural harvest/produce. TIA
Please try to post your question in accordance with the Ask Ghamidi Code of Conduct . https://ask.ghamidi.org/code-of-conduct/ Questions in violation of the code are not bound to be answered. Any post or question that does not meet the Ask Ghamidi Code of Conduct is subject to be removed without notice . Please always ask an objective question in a concise manner. This is the main reason responses are delayed, not given and the question is ultimately removed altogether. __ You have every right to disagree with Ghamidi Sahab and his students diagree with him on different points. You can try and post your question to Ghamidi Sahab directly ( if you can keep it brief and to the point ) by registering for the live event below: Discussion 101713 __ One point I’d like to mention is that I do not think that a retail trader and salaried employee are same when it comes to their income. One is trading goods and earning from that trade, which can fluctuate from 0/loss to any max. profit amount, the stock-in-trade is something unique to him, which is his asset, for which he will be liable to pay 2.5% zakat. And 2.5% zakat for a trader with stock-in-trade in not going to be any less as assumed in the question. While a salaried individual, even in the same industry, is producing income every month or every year which is not tangible per se, but similar in essence to how tangible production works, not in terms of the production mechanism but as an end result. As tangible production might use capital only or labour only or mix of both but here in salary mode, only labour is being used. And it known from Sunnah that 5%, 10%, 20% exist for production Zakat depending on the presence/absence of capital, labour or their mix. That is why this “ ijtihadi application ” is done, which means it is ijtihad of a scholar and if one agrees with it then one should follow it and if one disgrees with it then one should not follow it. One is accountable for his honest understanding of religion. And this income is only subject to Zakat if it passes Nisab threshold, and there is option to deduct Nisab amount from the gross production/income before applying 10% Zakat.
Thank you for your help and insights Umer Bhai. Would love to pose this question in that session. Yes I understand it again comes down to point of view but I was just curious that you mentioned it was the Sahaba who chose to do the asset Ijtihad on traders but I believed that was done by the Prophet himself in his time no? I mean he himself was a merchant and trading was a big thing during his time. If it had been applied later on then that would be a totally different discussion but my understanding was that the asset Zakat on trade is from the established Sunnah of our Prophet SAW.