Economy, Side Feature, The Khilafah

How the Khilafah Will Solve Poverty – PART 1

Despite the immense material and human resources, as well as the world’s richest oil and mineral reserves in our Muslim lands, the majority of the Muslim Ummah languishes in massive poverty, having less than 1.90 US dollars a day to meet their basic needs. The growing and huge mass unemployment, underdeveloped agriculture and industry, crippling taxation, constant surges in prices as well as hugely expensive and constantly unavailable power supply, are the clear proof of the mismanagement and exploitation of our lands and the huge misdistribution of our wealth. Government investment in infrastructure and public services in order to fulfil the basic needs of the people is minimal or non-existent.

Fundamentally these are the results of the non-Islamic policies according the dictates of the colonialist capitalist states’ political agendas applied by the rulers of the Muslim lands, including IMF and World Bank credits, which impose not only high interest rates but also devastating economic re-structuring policies upon our Muslim lands.

As a matter of fact; the humane and fair distribution of wealth in order to provide for the necessities of every human is not amongst the aims of capitalist economies. Furthermore maintaining the huge disparity in wealth between the rich and the poor benefits the capitalist ideology, as it has built up its existence on the exploitation of the masses, and the nurturing of the minority elite capital owners, who represent, maintain, and rule with the capitalist ideology, and whose obsession of material power increases day by day. Thus greed, unfair competition, exploitation and an economic guideline of “Big Fish Eats Small Fish” deprive humankind of their basic rights and needs.

“According to charity foundation Oxfam, the 26 richest billionaires own as many assets as the 3.8 billion people who make up the poorest half of the planet’s population. The wealth of the world’s richest 1% is equal to the total wealth of the remaining 99%.”

“About 10,000 people per day die for lack of healthcare and 262 million children are not in school, because their parents are unable to afford the fees, uniforms or textbooks. Women are dying for lack of decent maternity care and children are being denied an education that could be their route out of poverty.”

(Oxfam 2019 Report:

The Khilafah Not Only Prevents Poverty But Aims At Improving the Standard of Living of Each of Its Citizens!

Firstly; Islam’s economic system is purely based upon Qur’an and Sunnah, which demands from the individual and the state to guard the limits of Allah (swt). Islam rejects the theory of unlimited human needs and scarcity of resources as put forward by capitalism. Islam clearly states that Allah (swt) created plentiful resources in order to serve the needs of every human being. وَسَخَّرَ لَكُم مَّا فِي السَّمَاوَاتِ وَمَا فِي الْأَرْضِ جَمِيعًا مِّنْهُ إِنَّ فِي ذَلِكَ لَآيَاتٍ لَّقَوْمٍ يَتَفَكَّرُونَ “And He has subjected to you whatever is in the heavens and whatever is on the earth – all from Him. Indeed in that are signs for a people who give thought.” [Al-Jathiyah 13]

Our Prophet Muhammad ﷺ said the following about the basic needs of the individual human being: «لَيْسَ لِابْنِ آدَمَ حَقٌّ فِي سِوَى هَذِهِ الْخِصَالِ بَيْتٌ يَسْكُنُهُ وَثَوْبٌ يُوَارِي عَوْرَتَهُ وَجِلْفُ الْخُبْزِ وَالْمَاءِ» “The Son of Adam has no better right than that he would have a house wherein he may live, a piece of clothing whereby he may hide his nakedness and a piece of bread and some water.” [Tirmidhi]

These are the rights that Islam ensures to every human being and these are the rights that capitalism has deprived humanity of… Allah (swt) has made it an obligation upon the Khilafah to facilitate that every individual is able to fulfil his/her basic needs. The State has to ensure that the servant of Allah is able to fulfil his duty of seeking livelihood, and to make efforts to earn provision. The capable man has the duty to work in order to satisfy his own needs. As for women, and those men who are incapable of work, it is a duty to provide them with maintenance and this is a binding right for them, and the State is bound to provide it if the male guardians are unable to do so. Additionally the maintenance of the wife is a duty upon the husband. The maintenance of the children is a duty upon the father. وَعَلَى ٱلْمَوْلُودِ لَهُ رِزْقُهُنَّ وَكِسْوَتُهُنَّ بِٱلْمَعْرُوفِ “Upon the father is the mothers’ provision and their clothing according to what is acceptable.” [Al-Baqara 233]

The Prophet ﷺ said: «كَفَى بِالْمَرْءِ إِثْمًا أَنْ يُضَيِّعَ مَنْ يَقُوتُ» “It is sufficient sin for a man that he neglects him whom he maintains.” (Abu Dawud, Al-Nawawi) This means that work is compulsory on this capable man and if he does not undertake it he would be punished as is the case with every duty.

In the absence of anyone who was obligated to pay maintenance, or if they were present but unable to pay the maintenance, the Shariah obligated this maintenance upon the Bayt Al-Mal (State Treasury), in other words, upon the Khilafah State (Caliphate). For Rasulallah ﷺ said: «أَنَا أَوْلَى بِالْمُؤْمِنِينَ مِنْ أَنْفُسِهِمْ مَنْ تَرَكَ مَالاً فَلأَهْلِهِ وَمَنْ تَرَكَ دَيْنًا أَوْ ضَيَاعًا فَإِلَيَّ وَعَلَيَّ» “If anyone leaves property, it goes to his heir and if anyone leaves debt and dependants, let the matter come to me and I shall be responsible,” (reported by Muslim from Jabir)

This is also the evidence that from the most important issues for the Khilafah in managing the affairs of the Ummah is to create work for those who are capable but do not find any.

The fulfilment of non-essential Luxurious Needs must also be facilitated by the Khilafah, in the same manner as the basic needs. The State makes it easier for all the citizens to be able to satisfy their extra (non-essential) needs, and to achieve equality in society in the following way:

By giving out liquid and fixed assets from the funds of the Bayt Al-Mal, and from the war booties, and anything similar.

Donating some of its cultivated land to those who have insufficient land. Those who possess land but do not use it are not given more. Those who are unable to cultivate their land are given financial assistance to enable them to cultivate it.

Giving help to those unable to repay their debts by providing funds from the Zakah, and the war booty, and anything similar.

This is all the kind of support that we cannot find under the capitalist regimes in our lands.

Safety, all kinds of public services and utilities like health and educational services, are an obligation to be fulfilled by the Khilafah, in addition to ensuring the individual needs. These have to be financed from the funds of the State (Bayt-al Mal) for each of its citizens, regardless of their religion, race, sex or ethnic origin.

It has to be noted that a lack of safety leads to the failure in fulfilling all other obligations. That was the reason for why the very first promise Rasulallah ﷺ made to his companions, when informing them about the Hijrah, was that of safety: «إِنَّ اللَّهَ عَزَّ وَجَلَّ جَعَلَ لَكُمْ إِخْوَاناً وَدَاراً تَأْمَنُونَ بِهَا» “Allah made fellow brothers for you and a settlement that you feel safe in.” [Sirah, Ibn Ishaq] Consequently, public utilities and services must be undertaken by the Khilafah State, in accordance with the words of Rasulallah ﷺ: «الإِمَامُ رَاعٍ وَهُوَ مَسْئُولٌ عَنْ رَعِيَّتِهِ» “The Imam (ruler) is a guardian, and responsible (and will be questioned) for his subjects.” (reported by Al-Bukhari from Abdullah Bin Umar).

Islam’s economic system does not allow the accumulation and resources in the hands of a few. Thus, any time that a disparity is present, the Khalifah must work to achieve balance by putting this following verse into practice: كَيْ لَا يَكُونَ دُولَةً بَيْنَ الْاَغْنِيَٓاءِ مِنْكُمْ “So that it will not be a perpetual distribution among the rich from among you.” [Al-Hashr 7]

Islam unrestrictedly forbids the hoarding of wealth and has made obligatory the Zakah, in order to ensure that wealth is distributed among the people. Allah (swt) warns in this respect: وَٱلَّذِينَ يَكْنِزُونَ ٱلذَّهَبَ وَٱلْفِضَّةَ وَلَا يُنفِقُونَهَا فِى سَبِيلِ ٱللَّهِ فَبَشِّرْهُم بِعَذَابٍ أَلِيمٍ “And those who hoard gold and silver and spend it not in the way of Allah -give them tidings of a painful punishment.” [At-Tawbah 34]

What we face on mismanagement and lack of infrastructure will not exist under the Khilafah. Under the Khilafah, Islam will uniquely unleash great funds from the economy to fuel agricultural and industrial development, without crippling taxation, through a radical restructuring of state, public and private ownership amongst other measures.

Islam mandates the building of a powerful heavy industrial base, supported by world leading research, to propel the Khilafah in its role as a leading state. The agriculture under the Khilafah was the envy of the world for centuries and will be again! For Islam will link the ownership of land with its practical cultivation, will remove foreign ownership of agricultural land, as well as heavy taxation on agricultural inputs. This will be an immense boost to food security as well as domestic prosperity as the Ummah enjoyed for centuries under Islamic rule. Thus today the Khilafah will prioritize the crops that allow its citizens to have their basic needs of food and clothing met completely, with excess production being used for foreign trade. It will establish strong pastures to support a surge in livestock availability.

At the moment, electricity, coal, oil and natural gas are unaffordable and mostly unavailable due to capitalist privatization. The Khilafah will remove the energy resources from private ownership and return to public ownership so that power is provided readily as well as cheaply. It will abolish taxes upon power and fuel which have further greatly inflated their prices. Thus the Khilafah will demonstrate practically to a world that is crippled by the collapse of corrupt capitalism the truth of the Deen of Islam.

One of the most oppressive capitalist economy tools is taxation! Whereas in the Khilafah, neither income tax nor sales tax exists, because private property in origin is inviolable. Taxation occurs on surplus wealth beyond that which is needed to secure basic needs and that too is under stringent conditions. What allows this low taxation policy is the fact that the Khilafah has abundant sources of revenues from public and state property, as well as a unique set of laws for revenue generation from agriculture and industry.

Having deprived the Ummah of its rightful revenues and also choked its earnings and ability to buy and produce, the puppet governments in our lands have taken interest based loans from the kafir colonialist countries. These loans are a heinous trap, designed to keep the Muslim lands in debt, to strip us off our assets, and gravely reduce our ability to stand on our feet as a challenge to the West.

The ever increasing inflation in our lands is due to currencies that reduce their values constantly, as they are not based on gold and silver as obliged by Shariah. The currency of the state will be established on the gold and silver standard again which is the sure footing for the elimination of inflation from its root. The Khilafah will issue its own independent currency, which is restricted to gold and silver, and it will not be linked to any foreign currency in any way. The Khilafah will not take any interest based loans from kafir colonialist countries.

Khilafah will return our lands back to prosperity and abundance like in former times under the rule of Islam. Rasulallah ﷺ’s words are not only evidence for the responsibilities and obligations of the Khilafah, they are a promise and a glad tiding «الإِمَامُ رَاعٍ وَهُوَ مَسْئُولٌ عَنْ رَعِيَّتِهِ» “The Imam is a guardian and he is responsible for his subjects”

Africa, for example, was far away from being the poorest and hungriest part of this world during the times of Khalifa Umar ibn Abdul Aziz, because he did not apply anything other than the rules and principles of the Deen of Islam.

It has been narrated by Yahya bin Said, who was governor at the time during the reign of Caliph Umar bin Abdul Aziz (ra), that he said:

“I was sent by Umar bin Abdul Aziz to collect zakat from Africa. After collecting it, I intended to give it to the poor people. However, I did not find one. Umar bin Abdul Aziz has made all the people rich during that time. Finally, I decided to use the zakat fund to buy and emancipate slaves” IbnAbdHakam, Abdullah (1994) Al-Khalifat al- Adil Umar IbnAbd Aziz: Khamis al-Khulafa al-Rasyidin. Dar al-Fadilat, Kaherah 78

So have trust in Allah (swt)’s words, because you have already faith in them, so that we as an Ummah and the rest of the world can enjoy the fruits of Islam as soon as possible, inshaallah!

يَا أَيُّهَا الَّذِينَ آمَنُواْ اسْتَجِيبُواْ لِلّهِ وَلِلرَّسُولِ إِذَا دَعَاكُم لِمَا يُحْيِيكُمْ وَاعْلَمُواْ أَنَّ اللّهَ يَحُولُ بَيْنَ الْمَرْءِ وَقَلْبِهِ وَأَنَّهُ إِلَيْهِ تُحْشَرُونَ

“O you who have believed, respond to Allah and to the Messenger when he calls you to that which gives you life. And know that Allah intervenes between a man and his heart and that to Him you will be gathered.” [Al-Anfal 24]


Zehra Malik

Member of the Central Media Office of Hizb ut Tahrir


For further and detailed information, please read:

The Draft Constitution or The Necessary Evidences for it – Part 2 – (The Economic System, The Education Policy, Foreign Policy) by Hizb ut Tahrir


Pakistan’s Economy under the Khilafah by Hizb ut Tahrir / Wilayah Pakistan