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| Fatwa ID: | 77687 |
| Title: | Are treasury bonds halal? How do you pay zakat on them? |
| Category: | Financial Transactions |
| Scholar: | Dr. Main Khalid Al-Qudah |
| Date: | 02/04/2009 |
1. Are treasury bonds and municipal bonds halal?
2. How would you pay zakat on stocks and bonds?
Holding bonds means lending the government money on the basis of interest, which is definitely prohibited.
Once the lender receives his money back, he must get rid of the interest accrued by paying it in full to any of the beneficial projects for the Muslim community in his area, or any of the Zakah recipients, and the Zakah will be charged only on the original amount of capital, based on the Zakah rate of 2.5%.
As for the Zakah on stocks, if the plan is to hold them for long time, the Zakah is to be paid only on the profit/revenue of the stocks. Otherwise, and if the intent is to trade with the stocks themselves, then the market value of the stocks (including their profit) is subject to Zakah based on the same Zakah rate.
