NU Congress discusses zakat as tax credit

Jombang (ANTARA) - Delegates at the 35th Nahdlatul Ulama (NU) Congress are discussing the integration of zakat and tax through a scheme in which zakat serves as a tax credit.

The discussion took place during a session of the Bahtsul Masail ad-Diniyah al-Maudlu’iyyah Commission at the MAN 3 Bahrul Ulum hall in Tambakberas, Jombang, East Java.

One of the commission’s formulators, KH Ahmad Yazid Fattah, said in Jombang on Saturday that from the perspective of Islamic law, there are financial obligations on a person’s wealth beyond zakat, but their application is subject to specific provisions.

“However, what needs to be noted here is that these financial obligations other than zakat are realised in the form of humanitarian contributions. For example, to free prisoners of war, feed the hungry, and carry out rescue and relief efforts,” he said.

He explained that the discussion was part of the delegates’ effort to examine the issue of public financial obligations through the lens of Islamic jurisprudence.

In the forum, delegates also discussed efforts to optimise the role of state-owned enterprises (BUMN) as a source of state revenue outside the tax sector.

In addition to state revenue sources, the session discussed the idea of integrating zakat and tax, leading towards a “tax credit” scheme.

The idea explores the possibility of aligning religious zakat obligations with tax obligations as part of an effort to formulate equitable state fiscal governance.

Under current regulations, zakat paid by taxpayers through zakat collection bodies or institutions established or approved by the government may be deducted from taxable income.

The 35th NU Congress is holding a number of commission sessions in parallel, including the Bahtsul Masail ad-Diniyah al-Maudlu’iyyah, Bahtsul Masail ad-Diniyah al-Waqi’iyyah, Bahtsul Masail ad-Diniyah al-Qanuniyyah, organisation, programme, and recommendation commissions.

The results of each commission’s deliberations will subsequently be brought to the plenary session for approval.