Economic Advantages and Benefits of Zakat

Wed, 01/09/2013 - 03:18 -- Umar Farooq

The advantages and merits concerning to the financial matters of the Muslims are called economic advantages. Following are the economic advantages of zakat or Economic benefits of zakat.

1. Equal Distribution of Wealth

The main problem of modern economic system is unequal distribution of wealth which is the main cause of social and economic problem. Islamic economic system solves this problem with zakat in a good manner. Once government implement zakat, it will automatically solve the problem of unequal distribution of wealth because the rich people will give zakat to poor for consumption.

2. Circulation of Wealth

To gain economic development it is very important that any country’s capital should circulate instead of accumulation. If capital goes towards accumulation the economic activities will become slow. Zakat is the best tool to circulate the money in economy.

3. Economic Stability

Zakat avoids interest system. When the economy is prosperous the amount of zakat increases among poor. All these bring a balance in economic condition.

4. Solution for Unemployment

Once Dr. Keynes said, the basic reason of unemployment is the shortage of an effective demand. It is zakat through which unemployment decreased by increasing the level of effective demand. In Islamic economic system unemployment allowance can be given to unemployment persons.

5. Capital Formation

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