Zakat on Government Linked Companies (GLCs) in Malaysia: an analytical and applied study = الزكاة على الشركات المرتبطة بالحكومة في ماليزيا: دراسة تحليلية تطبيقية

Mohd Effandi, Muhammad Lutfil Hadi and Mat Jubri@Shamsuddin, Mustafa (2024) Zakat on Government Linked Companies (GLCs) in Malaysia: an analytical and applied study = الزكاة على الشركات المرتبطة بالحكومة في ماليزيا: دراسة تحليلية تطبيقية. Jurnal Fiqh, 21 (1). pp. 151-176. ISSN 1823-089X E-ISSN 2289-7518

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Abstract

This paper explores the obligation of zakat on Government Linked Companies (GLCs), noting a disparity where most zakat is collected from salaries despite business taxes constituting over half of Malaysia’s tax revenue. It aims to identify the shariah ruling concerning zakat on GLCs, by examining the requirements for zakat on both the payer and the wealth. Following with an analysis of Malaysian laws and fatwas related to zakat on GLCs, aiming to assess the current applications and the feasibility of enforcing it on these entities. The study finds that al-fuqaha’ disagree on the obligation of governments to pay zakat on investment funds, with a majority deeming them exempt, while a minority advocate for their zakat obligation. The dispute comes from varying interpretations of zakat eligibility for certain types of governments’ wealth. Despite this, several Malaysian states have issued fatwas that seems to support the minority view. However, the enforcement of these rulings may be unconstitutional, due to some misalignments between state authority over zakat and federal authority over corporations.

Item Type:	Article (Journal)
Uncontrolled Keywords:	zakat, government linked companies, Malaysia, public’s wealth, legal entity
Subjects:	BPH Islamic Economics > BPH531 Zakat BPK Islamic law. Shari'ah. Fiqh
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Kulliyyah of Islamic Revealed Knowledge and Human Sciences > Department of Fiqh and Usul al-Fiqh
Depositing User:	Dr. Mustafa Mat Jubri @ Shamsuddin
Date Deposited:	18 Jul 2024 11:29
Last Modified:	18 Jul 2024 16:57
URI:	http://irep.iium.edu.my/id/eprint/113233

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