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Taxes In Non-Muslim Countries And Using Loopholes In Tax Laws
I live in the UK. I have following questions:
1. What is Islamic view on paying income tax and other taxes to government of a country where you live in?
2. UK is not a Muslim majority country. Am I required to pay taxes to UK government from an Islamic perspective ?
3. Will it be a sin if a British Muslim does not pay taxes to UK government?
4. Is it OK for an accountant to complete and fill tax returns for small businesses? Will they be sinful if they advise clients about tax loopholes to save or avoid income tax?
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7 Replies
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Taxes In Non-Muslim Countries And Using Loopholes In Tax Laws
updated 3 years, 6 months ago
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Replies
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Yes of course you’re supposed to pay taxes and obey all other laws of the state that you reside in. Yes it will be immoral and consequently sinful to evade taxes.
Please keep in mind that you can deduct the amount of taxes you pay to your state from your zakat.
Finally, “loopholes” in the tax code are generally just creative ways to legally save on taxes. There’s no problem with advising someone about these or using these tactics ourselves as long as there’s no cheating or other immoral aspect involved.
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Dear Faisal
Thanks a lot for your responses and it is very kind of you!
My question was in the context that our respectable Ghamidi Sahib saying that the state cannot take a single penny from a person more than what Allah has allowed under Zakat.
This raises a question as to why then we need to pay taxes to a government specially when they ask us to pay up to 40% of income in UK.
I know it is illegal to evade taxes. I also know that Ghamdi Sajib says that you can deduct Zakah from the taxes you pay etc., I have been regularly listening to him for the past year and it has completely changed my perspective on Islam. May Allah bless him and reward him immensely- Ameen.
However my question is what Shariah principle we can use to justify payment of taxes to a government in a non Muslim country like UK given what Ghamidi Sahib says about lack of eligibility of state to take from a person.
Will it come under the principle of obey Allah, His Messenger and those who have authority over you?
Please clarify this point from an Islamic perspective (use some Quran principles in support please).
I have heard some other scholars strongly ridiculing the Western concept of charging taxes etc.,on YOUTUBE as they feel it comes under Zulm and injustice.
Jazakallah Khairan and May Allah bless you and immensely reward you for your excellent work,.
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An Islamic state can’t demand from its citizens anything more than what God has regulated in the form of zakat. In other states, we can disagree with a higher tax rate, however, we’re still obligated to pay what the law requires us to pay.
It must be noted that the taxes we pay to our respective governments today are largely used for the same purposes as zakat would be used in an Islamic state. This includes many facilities we enjoy as a citizens of a state, for example, infrastructure, libraries, parks, medical facilities, social services, etc. as well as salaries for those who run this entire machinery of the state.
Secondly, as citizens of any state we’re bound by an implicit (or sometimes explicit) contract which compels us to pay our dues and also abide by any other laws.
The underlying principle in this matter is that of morality. As Muslims we’re required to uphold high moral standards in every aspect of our lives. For details, please see:
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For comments of Ghamidi Sahab on what should be attitude of Muslims when they’re imposed with high taxes over and above Zakat:
Please refer to the video below from 18:10 to 23:35
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For comments of Ghamidi Sahab on using loopholes available in the tax laws to reduce tax liability:
Please refer to the video below from 42:12 to 44:26
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Jazakallah Khairan- can you please the links for two video clips? I want to share with a friend of mine who is an accountant and wanted answers for questions that I raised with you about the issue of paying taxes to non Muslim government such as that of UK. Jazakallah Khairan
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You can click on the three vertical dots displayed on the top right corner of the video post, then click on Share.
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