Translation
Charity [obligatory charity, Zakat] should be directed to (1) meet the need of the poor and otherwise needy, (2) bear expenses for those employed to administer the fund, (3) support those whose hearts incline to (faith, truth and justice), (4) (to free) people from captivity and debt, (5) those who strive selflessly in God’s way (establish truth and justice) and (6) travelers (away from home). This is an obligation from God. God is Knowing and Wise! 434
Interpretation
434 Zakat, as distinct from regular charity, is assumed to be meant here, though the word used is Sadaqat, which is regular charity. Such rendering of meaning of zakat in this instance is based on the specific ways such charity are to be given and the fact that the notion of administrating such charity is mentioned. The expenses of such administrators are to be funded from the charity, and such charity is made obligatory (Faridah) in this verse. For more details and a broad understanding of zakat and charity, please see Volume 3, Appendix A.
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REFLECTION
Regular charity (sadaqah) has been encouraged in general for everyone and of every means, as much as one can afford to help and support other human beings who are less fortunate, starting with family and blood relationships and then extending to neighbors, communities, and people at large. Zakat by contrast is a wealth tax, made mandatory, so that those who have assets and wealth and source of earnings should dedicate 2.5 percent of such items of wealth and assets for the benefit of social good, as stipulated in the above verses.
ACTION
In our contemporary world, there is much discussion about income inequality and structural disadvantages to the less wealthy in wealth accumulation compared to those who are already wealthy or born with wealth. The tax code that imposes a lower tax rate (in the United States, 15 percent on capital gains), compared to up to 39 percent on income from labor, various tax exemption for capital investment, tax write-offs from leveraged transactions without limits, no or minimum estate taxes for the wealthy, and corporate laws that seem to only allow unlimited access to wealth created by businesses to their wealthy shareholders in exclusion of employees and communities make such wealth creation possible. The call to action is very clear: we need to reform our tax code and corporate laws and create a spiritual and social climate of giving and deploying accumulated wealth for the benefit of all and not for the few. This is a not a concept of socialism but informed and conscious application of capitalism that benefits capital owners who cannot make the capital work without the benefit of labor, and the willingness of communities to buy and pay for such output from capital and labor. Capital, labor, and value creation/extraction all go hand in hand, and our current system makes the owner of capital favored in a way that workers are not getting living wages, profit is not reaching every part of the society, and average human beings are forced to pay monopolistic and oligopolistic prices, all of which acts like a big funnel to suck up wealth from all to the very few rich people of the society. This is alarming and needs to be fixed by all working together. It is not to be done by pitting one group against another but as a collective responsibility through our political, social, and economic systems.