Zakat alms payments will remain voluntary

Abu Dhabi: Zakat payments will continue to be left up to the discretion of individuals and companies "for the time being", the UAE Zakat Fund chief has said.

Zakat is the Islamic requirement for giving alms. Last year the government rejected the Fund's proposal for legislation that would require individuals and companies who meet a minimum asset value threshold to make the annual payment.

"What we have to do now is raise awareness of how voluntary payment can benefit us as a society," Secretary General Abdullah Al Muhairi said.

Al Muhairi said the Fund has seen its annual revenues grow from Dh7 million in its first operational year in 2004 to Dh45 million last year.

Estimates have put potential annual revenues near Dh6 billion if Zakat payment is made mandatory.

High net worth individuals in the UAE, or those with net assets of $1 million (Dh3.67 million) or more, numbered 67,000 in 2008, or about 18 per cent of the Middle East regional total, according to Merrill Lynch's annual World Wealth Report released in June. Of GCC Zakat funds, only Saudi Arabia's and Kuwait's require payment.

"We're trying to implement best practices as we have observed in other GCC Funds," Al Muhairi said. The Fund now allows Zakat payments to be made online, via mobile phone and through some ATMs.

According to Sharia, Zakat is an obligatory annual payment of 2.5 per cent of surplus wealth, or savings which have been unutilised for one year. The money is used to aid specific categories of needy individuals identified in the Quran.

By Ahmed A. Namatalla, Staff Reporter

Islam | Business | |