PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

INTRODUCTION
Treasury is a financial institution that works to manage the property or the public to keep valuables such as gold, silver, precious stones and the like. Treasury began during the Prophet's era and continued to Rashidun and beyond and streamlined. implementation during the period of Rightly Guided Caliphs. Source Baitulmal derived from 3 main sources Real Community - Resources derived from the rich and distributed to those entitled to receive it. Real National - Resource obtained from the spoils of war, tax Kharaj, tribute out and property without heirs. Property General - comprises the results of business, agriculture and others.

The purpose of the Baitulmal is to enhance the development of national economy, provide basic needs and poverty eradication. Baitulmal property division determined in accordance with the requirements in a fair and equitable economy based on Islamic principles.

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

TREASURY
Treasury from the Old French word tresorie. A place where treasure is stored safely, a place where state or royal money and valuables are stored and a collection or artistic or literary works.

Treasury is any place where the currency or item of high monetary value like rubies and diamonds etc. are kept. The term was first used in Classical times to describe the votive building erected to house gifts to the gods, such as the Siphnian Treasury in Delphi or many similar building erected in Olympia, Greece by competing city-states to impress others during the ancient Olympic Games.

In Ancient Greece treasuries were almost always physically incorporated within religious buildings such as temples, thus making state funds sacrosanct and adding moral constraints to the penal ones to those who would have access to these funds.

The head of a Treasury is typically known as a Treasurer This position may not necessarily have the final control over the actions of the Treasury particularly if they are not an elected representative

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

BAITULMAL
Bayt al-mal (baitulmal) is derived from the Arabic word ( ,) bayt al-mal which means "house property". In Islamic history, Bayt al-mal is a financial institution responsible for administering the tax. Bayt al-mal functions as treasury caliphs and sultans of managing personal finances and government spending. It also manages the distribution of public charity for the people. Modern Islamic economists consider the institutional framework appropriate to the Baitulmal as the Muslim community now. The concepts of welfare and pension were introduced in early Islamic law as forms of Zakat (charity), one of the Five Pillars of Islam, during the time of the Rashidun caliph Umar in the 7th century. This practiced continued well into the era of the Abbasid Caliphate, as seen under Al-Ma'mun's rule in the 8th century, for example. The taxes (including Zakat and Jizya) collected in the treasury of an Islamic government were used to provide income for the needy, including the poor, elderly, orphans, widows, and the disabled. According to the Islamic jurist Al-Ghazali (Algazel, 10581111), the government was also expected to stockpile food supplies in every region in case a disaster or famine occurred. The Caliphate is thus considered the world's first major welfare state.

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

BAITULMAL IN MALAYSIA
Baitulmal is the treasury and financial institutions holding property in the Islamic countries. Wealth accumulated in the treasury is the property owned by all the people who live and lived under the Islamic government. Treasury in accordance with the views al-Mawardi is the record collection and distribution of wealth. More precisely treasury as treasury country is receiving from various sources of financial and property accumulated by Islamic countries such as charity(zakat), wakaf property, tax and others. Treasury contains a concept and a very broad understanding of property based on the full faith and piety to believe that only beseech God the Creator. Administrator and Superintendent of the universe, while the Caliph was a trustee to manage property that has accumulated in the treasury. In fact, the scope of treasury accounting for a larger role compared with the treasury national concepts today that not only serves as national treasures through institutional policies and its importance to the government, even acting as a central bank that serves the nation's financial system. If viewed from context treasury at the beginning of Islam, a fact for a country's treasury. But for Malaysia, administration and coordination of treasury and restricting the scope of its functions by creating two fractions in the administration, the national treasury through the Ministry of Finance and treasury through the state government. In terms of administration, treasury now more systematically with the existence of various provisions that gave jurisdiction to the Islamic Religious Council to manage the scope of management and treasury functions are made in accordance with reasonable time requirements and local requirements.

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING Income and expenditure shall be in accordance with treasury regulation of Allah in the Qur'an and Sunnah of prophet as well as conditions such as the recommended law istinbat Ijma, 'Qiyas and other resources coincide with the spirit of Islamic legislation, such as al-maslahah mursalah, istislah, istishab and Istihsan. Wealth owned by Serra Islamiyah

Zakah Kharaj. Jizyiah Ghanimah and Al-fay Usyur. Tribute out. Various public property. Property in the form of state-owned land, buildings, public facilities and income. Property is not the legitimate authorities and officers of the country, property work with contradictory legislation and the property I obtained from other fraudulent actions.

Khumus discovery property and mineral. Real advantage of the remaining heirs and distribution of property which has no successor.

Real people apostates. Taxes.

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

SOURCES TREASURY(BAITULMAL)
ZAKAT
Zakat in Arabic ( ) sometimes "Zakh/Zekat" or "alms giving", one of the Five Pillars of Islam, is the giving of a small percentage of one's possessions (surplus wealth) to charity, generally to the poor and needy. It is often compared to the system of tithing and alms, but it serves principally as the welfare contribution to poor and deprived Muslims, although others may have a rightful share. It is the duty of an Islamic community not just to collect zakat but to distribute it fairly as well.

In terms of language charity means clean, pure, fertile and growing. From Sura Al-Taubah (09), verse 103:

(103)
Take )some) from their wealth alms )zakat), that so thou purify them (from sins) and purified them (from moral evil) and pray for them, surely prayers (Muhammad) is to be security for them ) remember) Allah is Hearing, Knowing

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING Conditions For Zakah

Several conditions must be fulfilled before zakah can be paid. These conditions are necessary as zakah can only be applied on those who are of legal age and who own enough assets. These conditions are categorized into two broad categories, namely performer and asset.

Zakah Performer Muslim - Every Muslim who is of a certain age and owns enough assets is required to pay zakah.

Zakah Asset - Full Ownership A Muslim will only be required to pay zakah if he or she has full and legal ownership of an asset.

Zakah is payable only on those assets that are acquired for the purpose of creating or generating wealth. Some examples of this type of assets are livestock or crops that are traded or sold, inventory of goods used for trading, and investments such as gold or securities that have potential for appreciation in value. However, zakah is not payable in the case of fixed assets such as buildings, if they are not subjected to "capital circulation".

Assets That Exceed A Minimum Value

Zakah need only be paid on those assets that exceed a minimum value. This minimum value is calculated based on the market price of 85 grams of gold or 595 grams of pure silver. This minimum value is termed Nisab. The Islamic Fiqh and Research Councils, as well as Jumhur (majority) of Ulama' recommend that gold be used as the basis for the calculation of nisab.

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING Completion of Haul

Haul is defined as the completion period for a zakah asset. The length of time for haul is one Islamic or Hijri year (1 year Hijri = 354.5 days, 1 year Solar = 365.25 days). Zakah is only payable on assets that have been held for at least this period.

Types of Zakah

Zakah Fitr is a one off payment that is made once in every Muslim Hijri calendar year at any time between the first day of the month of Ramadhan and the first day of Shawal. All Muslims are obliged to pay this, regardless of their age, status or wealth. The amount of zakah payable is approximately 3kg of staple food in the relevant country or an amount of money that is equivalent to the price of the food.

Zakah al-Mal is an annual payment based on the amount of wealth owned by a Muslim individual or organization. This payment is obligatory upon any Muslim individual or organization that has completed the requirement of Nisab (minimum taxable amount) and Haul (one Muslim Hijri calendar year). The payment is 2.5% out of the total wealth deemed for zakah.

Zakah Al-Mal Can Be Subdivided Into Zakah On:

Business Personal Income Gold and Silver Livestock

Rental Income Savings Shares Crop

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

KHARAJ
Kharaj means land revenue tax imposed on non-Muslims. In Sharia law, Kharaj is tax on agricultural land. Kharaj not mentioned in the Quran or Hadith, but more to Ijma' agreement or Islamic scholars and some of the traditions of Islam or URF. In Islamic history, Kharaj form of duty imposed on land that was confiscated from the Byzantine Empire and Sassanid, whether through war or peace. If the peace agreement between Muslims and residents has been agreed that says the land is owned by Serra Islamiyah (country), and they agree to pay Kharaj, they must be fulfilled. Kharaj by language means al-kara '(rent) and al-ghullah (results). Each soil taken from the kuffar by force, after they declared war on, so land that categorized as land kharajiyah. Although they embraced Islam after the conquest, but the land is still land kharajiyah status. While the number of Kharaj collected from the compulsory land shall be calculated based on the land. At the time of 'Umar set Kharaj, examine the contents of his land, and not act against the wrong owner and plantation. In some situations he has been collecting for every 1 Kharaj jarib to 1 qafiz and 1 dirham. In the event that he and other land Kharaj collect the amount is different. Syria is in the area he collect total Kharaj different. Therefore, it is known that he examine the content of each soil based on the rate of land. An Imam (Caliph) can be calculated by observing Kharaj matters which should be based on three aspects of this:

PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING 1. based on land area, or 2. pastures, or 3. will be calculated based on crop yield can be at that time. If the land is so been fertilized pastures can increase yield, or the land is attacked factors that can make the results less watering then such matters must be studied first.: If the yield increase is the result of the efforts of farmers, for example they have been digging wells, or they make water, so they will not be added Kharaj even slightly.

JIZYAH
Jizyah or jizya ) ) is the extra tax imposed on non-Muslims (Dhimmis) who live under

Muslim rule according to the Qur'an and

The name for the head-tax under Islamic rule extorted to the dhimmies. This must be handed over in obsequious way (including impacts on the necks). Welfare benefits and cash allowances to Mohammedans are often regarded as the jizhya which has to be given to them. So are the billions given by America to the Palestinians, Egypt, Pakistan, etc. which basically only feed their hatred towards the West.

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING Fight those who believe not in Allah nor the Last Day, nor hold forbidden that which hath been forbidden by Allah and His Messenger, nor acknowledge the religion of Truth, (even if they are) of the People of the Book, until they pay the Jizyah with willing submission, and feel themselves subdued. (Qur,an 9:29)

Once a land is conquered by Islamic armies the ruler can impose a taxation on those nonMuslims who will not convert to Islam.

Jizyah is paid as a sign of submission and gives Dhimmis some legal protection in return. Under dhimmitude (the status that Islamic law, the Sharia, mandates for non-Muslims) Dhimmis usually are not allowed to carry arms to protect themselves, serve in the army or government, display symbols of their faith, build or repair places of worship etc. If the conquered do not wish to pay or convert, their fate may very well be slavery (under which, rape is permitted) or (as evidenced in the quotes above) death.

The amount of the Jizyah tax and the way it was collected varied from time to time and from place to place, but when imposed, the forced payment of Jizyah greatly stimulated the conversion of non-Muslims into Islam. In some cases the taxation of the non-Muslims was so profitable that the Islamic rulers prohibited their subjects from converting to Islam, lest they should lose their income.

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING GHANIMAH AND AL-FAY. 1. Ghanimah the spoils. 2. Al-fay is without spoils of war, legacy of the dead with no heirs and treasure.

3. One-fifth of the property ghanimah and al-fay expenditure allocated to the center in Medina. The remainder of the property is divided into forces involved in the war J

USYUR.
i. ii. Usyur business tax is imposed on Muslims and non-Muslim businessmen. To reject Harbi, which reject the peace treaty with no Islamic country imposed usyur by 10%. iii. iv. For Zimmi reject the government under the Islamic rule imposed by only 5%. Usyur tax imposed when enough nisabnya ie as many as 200 dirhams.

TAXES
Tax is a cost paid by individuals or companies to the government. How to use the collection of taxes and how tax money is material in the hot talk of politics and economy. Political science / economics of public finance is the tax debate. Type of tax Among the types of taxes:

Income tax Tax sales Land tax Tax door

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING Property Tax In Islam Acquisition of property (of Muslims), this is referred to as dharibah (a collection) is allowed by syara 'to be collected by Serra Islamiyah (country) and the responsibility of countries to spend with the right. It should be emphasized that dharibah not 'tax' as often wrong interpreted or the arguments made by those who are ignorant to allow tax. Dharibah is a form of 'special collection' collected from the rich Muslims / feasible only, that is only on the condition experience Bayt al-mal or deficit are not sufficient to perform any obligation of the country. Cant collect if dharibah Baitul mal countries still inadequate. It is only collected in the state of the country is so desperate if not collected, then a duty will be neglected. Dharibah can only be collected in the following circumstances only, 1) To meet basic needs (food / clothing / home) those poor and needy 2) For financing the administrative machinery of the country to watch as people continue to work as staff salaries and administrative infrastructure 3) For providing public facilities such as roads, hospitals, mosques, schools and similar 4) For recovery situation after people suffer from natural disasters like floods, hurricanes, earthquakes, landslides and similar 5) For Jihad Fi Sabilillah.

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING Dharibah not like the current tax (in the economic system of capitalism) because 1) It is resouces and taken inspiration from the Prophet's Hadith and also Ijma Friend 2) It is not a source of fixed income countries because it is collected only when the Baitul Mal had a deficit and facing a critical situation and it is not collected only by prolonged 3) It is only collected from the rich Muslims / eligible in accordance with the rates ma'aruf until sufficient rate required only 4) It is used to provide services to the people / nation, not for personal interest or government Kroner

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

BAITULMAL ROLE IN ISLAMIC COUNTRIES

1) Help the economic development of Islam. i. Helping the poor and less fortunate. ii. Can reduce the gap between the rich and the poor. iii. Forms of assistance such as food, shelter and so forth. 2) Major source of strengthening the armed forces. i. Important to ensure the threat from Islamic countries who have an enemy military force. ii. During the reign of Caliph Uthman, treasury resources are used to strengthen the forces of Islam who are facing threats from the Byzantine army. 3) Distribute financial resources for the central government expenditure. i. Involve administrative costs and give allowances to the armed forces. ii. During the reign of Umar, Baitulmal has issued allowances to armed forces as a substitute to a prohibition of land in the newly conquered land. iii. This can help inhabiting the country from causing conflict to have the land. 4) Coordinate collection and distribution of property based on Islamic sharia. i. Baitulmal property cannot be used at will. ii. Distribution must be fair and equitable. iii. During the reign of Ali, he never used the property Baitulmal when facing opposition from Muawiyah even get pressure from their friends. 5) Keeping the property.

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

ISLAMIC COUNTRIES
Political aspects of Islam, Sharia, Caliphate, Religious police, and Islamism

Although the separation of church and state was first theorized by Averroes, most Muslim-majority countries recognize Islam as the state religion, but most of them do not place Sharia Law as the constitution itself

Afghanistan (Islamic state) Algeria Bahrain Bangladesh (Islamic state) Brunei Comoros Egypt Indonesia Iran (Islamic state) Iraq Jordan Kuwait Libya Malaysia (Islamic state)

Mauritania (Islamic state) Morocco Oman Pakistan (Islamic state) Qatar Sahrawi Arab Democratic Republic Saudi Arabia (Islamic kingdom) Somalia Tunisia United Arab Emirates Yemen (Islamic state) Maldives Morocco

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING Sunni Islam

Algeria Bangladesh

Pakistan Saudi Arabia religion) Somalia Jordan Indonesia (as state-sanctioned

Comoros Malaysia Maldives

Shi'ah Islam

Iran (as state-sanctioned religion)

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PHILOSOPHY AND CONTRACT IN ISLAMIC FINANCE AND BANKING

CONCLUSION
Implementation Baitulmal during Rashidun is based on Islamic and distortion does not occur. Bayt al-mal economy can increase the Muslim community. We would have realized the key aspects of the economic system I highlighted are much more than the current Islamic Banking or Islamic Finance and it should be clear that this system cannot be implemented without a true Islamic state which rules by the Shariah and unlike the Muslim world today is a truly independent state and not an agent of the west. Instead of turning to billions of dollars of bailouts where the US and UK are spending tax payers money in order to save their collapsing financial system, people should realized that Islam offers the world a practical alternative. The next speaker will elaborate on the importance of taking the Islamic system as a whole and not separating the economic system of Islam from the other systems such as ruling or punishment. Even many non-Muslim thinkers have recognized the progress and development that was achieved under Islamic rule in history in all fields of science and technology.

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