Tax deduction of 'zakat' must apply to non-Muslims

The law to make the religious requirement for Muslims to donate at least 2.5 percent of their wealth to charity (zakat) tax deductible has come into effect. Sociology of religions expert Abdul Munir Mulkan of the Yogyakarta-based Kalijaga State Islamic Studies Institute (IAIN) talked to Sri Wahyuni of The Jakarta Post. The following are the highlights of the interview.

Question: How do you view the forthcoming implementation of the new law on making zakat donations tax deductible?

Answer: It's an interesting development that might be the answer to what has been a political demand of Muslims in the country. But, problems will possibly also arise, especially regarding the planned establishment of the National Zakat Donations Board by the government, mostly because there are numerous similar non- governmental agencies in the community, all working under different names, that carry out the same job of collecting zakat.

Therefore, the government should accommodate and recognize the existing zakat bodies as authorized collectors. In such a case, the government-established board would act mainly as an administrator. It would not be wise for the government to ignore these bodies as this could create a very complicated problem. Could you elaborate?

The biggest problem with the establishment of the zakat board would be the people's (lack of) trust in it, especially regarding its ability to convince the community that it redistributes to the community all that it collects from the community.

So what is also important for the government is to provide clear rules and regulations on the issue to prevent manipulation from occurring in the board. Transparency should be a high priority.

Of no less importance is the capability of the House of Representatives to control the board in collecting and distributing zakat.

Deciding that zakat maal (as opposed to zakat fitrah, the obligatory contributions paid at the end of Ramadhan) is tax deductible is good, and so is the government's policy of formalizing the body that collects and distributes zakat. Yet, there are certain things that the government should take into consideration. Would these include a feeling of being discriminated against among non-Muslims whose religions also hold charity in high regard?

That's true. Besides the internal problems that might be generated within the Muslim community itself, there are also possible problems concerning the adherents of other religions. Under different names or terms, other religions also collect charitable donations from their community that are considered as much a sacred duty as the zakat that Muslims are required by their religion to pay.

The government must take this into consideration. The policy must be extended to the followers of other religions that also have similar requirements. Otherwise, problems could emerge that the government would find difficult to handle in the future.

So, is this policy discriminatory?

Yes, you could take it that way if the government does not complement the policy with regulations that accommodate existing zakat agencies as authorized zakat collectors, or if it ignores similar charitable practices on the part of other religions.

Therefore, to avoid being considered discriminatory, the government should also extend the same facility to the followers of other religions -- the government must also recognize similar religious obligations on the part of non-Muslims as tax deductible. Is it wise to recognize such religious obligations in civil law and make them tax deductible?

Actually, the idea of converting zakat into a tax obligation or making it tax deductible has long been discussed among Muslims.

From the theological point of view, there is no problem with it. The only problems would likely be political or administrative.

So, if the concept (of formalizing zakat) could be developed and could be widely accepted, it would indeed be an interesting breakthrough.

And if the government was able to assure Muslims, who comprise the majority here, that the board was able to contribute something to the community, Indonesia might not need aid from the International Monetary Fund. How is that possible?

I once made a rough calculation about the amount of money that could be collected in a year if all Muslims in Indonesia were to pay their zakat. The figure I got was amazing.

I forget the exact amount, but if it were deposited in a bank, the monthly interest could feed all Indonesians throughout the country for a day. Just imagine how useful that sort of money would be if it were used to help poor people in Gunung Kidul regency (in Yogyakarta), for example.

Thus, we would have an alternative to (the negative aspects of) capitalism as a result of which the poor became poorer while the rich become richer.

Therefore, the government should invite all elements of society to participate in a debate on all the types of charitable work required by the various religions so that the law could be more of a help and of more benefit to the people.

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"Under different names or terms, other religions also collect charitable donations from their community that are considered as much a sacred duty as the zakat that Muslims are required by their religion to pay."