Posts Tagged ‘customs duty’


La sabiduría de Colón

October 10, 2011

A major factor behind Christopher Columbus’s voyage across the sea in 1492 was his desire to sidestep the heavily taxed Ottoman land routes, as Money Jihad documented on Columbus Day last year.  This year, in honor of King Ferdinand and Queen Isabella who funded Columbus’s voyage, and in appreciation to our readers in the Spanish-speaking world, we offer the information in Spanish:

Constantinopla Cristiana cayó al Imperio Otomano islámico en 1453. Los otomanos habían ganado el control de la Ruta de la Seda al Lejano Oriente. ¿Qué significó esto para la Europa cristiana y el descubrimiento de América? La Prof. Cynthia Smith, de la Universidad de Hawai, explica:

Hay una consecuencia final del control y la expansión otomana, quizás la más importante desde la perspectiva de la historia del mundo. El Imperio Otomano, a finales del siglo 15, controlaba el Cercano Oriente y el Mediterráneo Oriental. Esto significaba el control de las rutas de tierra que unían la Ruta de la Seda entre Asia y el Mediterráneo. El control de estas conexiones de comercio Este/Oeste permitió que los líderes otomanos cobraran impuestos a todas las mercancías que circulaban al Este y el Oeste a través de sus territorios. Por lo tanto, el control estratégico producía asombrosa riqueza para el Imperio Otomano–riqueza que disfrutaron por siglos.

Este control fue, como era de esperarse, una fuente de resentimiento cada vez mayor por parte de los europeos, especialmente después del siglo 14, cuando el comercio se convirtió cada vez más importante para los europeos. Los comerciantes europeos y líderes resentían la pérdida de ingresos debido a los altos impuestos, y los consumidores europeos de productos asiáticos resentían los altos precios. También hubo tensión religiosa sentían por los cristianos que tenían que seguir las leyes musulmanas para mantener sus conexiones comerciales con el Oriente. Este resentimiento que algunos europeos llamaron el “dominio absoluto” del Imperio Otomano en el comercio internacional fue la razón principal por la cual los líderes políticos y los intereses comerciales invirtieron dinero en  esfuerzos para encontrar las rutas marítimas a los mercados de Oriente–lanzando cambios épicos provocados por la exploración europea y la expansión a finales de los años 1400 a 1500.

En otras palabras, los viajes que resultaron en la “Era de los Descubrimiento” o “Edad de la Expansión” europea fueron motivados principalmente por el deseo de soslayar al Imperio Otomano. La expansión del dominio europeo y el poder global que fueron el resultado de estas primeras expediciones cambiaron la historia del mundo. El dominio otomán regional y los intentos europeos para evitar el control económico fueron los catalizadores del dominio marítimo europeo, la colonización, el “descubrimiento” del continente americano y el aumento de las interacciones globales.

Cada vez que alguien pasa a través de la jurisdicción de un ashir’ (recaudador de impuestos), paga impuestos. Si usted es un comerciante extranjero musulmán en un país musulmán, puede pagar aduanas mínimas. Cuando usted es un comerciante no musulmán en un país musulmán, tiene que pagar el máximo. Los intereses vitales de Europa eran incompatibles con la extorsión sharia durante la Era del Descubrimiento. ¿Cómo es que hemos olvidado lo que Colón reconoció 519 años atrás?


Al-Shabaab levies zakat tax on charcoal

September 19, 2011

The recent report from the U.N. monitoring group on Somalia and Eritrea describes one of the many revenue sources of economic powerhouse al-Shabaab as a 2.5 percent tax on coal.

Let’s see—2.5 percent for producers, 2.5 percent for transporters, 2.5 percent for workers…  I’m sensing a pattern.  But golly gee, what’s the significance of 2.5 percent?  As detailed as their report is, the U.N. doesn’t spell out the fact that 2.5 percent is equal to one-fortieth, which is the rate set for the zakat tax by the Hadith and the Profiteer Muhammad.

Islamic law also applies the same 2.5 percent rate as a customs duty against articles of trade by Muslim merchants.  Al-Shabaab is carrying out Sura 106 of the Koran and the precedent set by Caliph Umar in so doing.

With the firm Islamic context in mind, here are some of the findings from the U.N.:

Table: Tax figures for charcoal production in Al-Shabaab controlled areas in April 2011

  • “Local charcoal producers pay a ‘production tax’ of 2.5%, in return for which they receive production ‘certificates’. The charcoal is transported to port on trucks, whose owners are also required to pay a tax of 2.5% of the estimated value to Al-Shabaab. In addition, if stopped at a checkpoint, truck owners pay a checkpoint fee per truck (Annex 3.2.a and 3.2.b). Failure to pay taxes can lead to seizure of the consignment and/or imprisonment…”
  • “The owners of barges that carry the charcoal from Baraawe to offshore vessels pay a tax of 2.5% of the estimated value of their cargo. While smaller boats are charged $0.5 per sack of charcoal. Porters employed for loading and discharging charcoals must also pay 2.5% of their salaries to Al-Shabaab…”
  • “Some privileged companies are permitted to export charcoal tax free, using green colored sacks reserved exclusively for Al-Shabaab-approved enterprises. These sacks are not available for purchase on the local market, and are usually sourced in Dubai, the UAE.”

“Illegal taxes” collected in Karachi

November 25, 2010

Pakistan is crawling with mafia syndicates—the drug mafia, the land mafia, the weapons mafia.  But the father of all three is the “bhatta” mafia.  Bhatta refers to extortion.

The bhatta mafia have become increasingly active this year especially against businessmen in Karachi.  Cattle ranchers, rickshaw drivers, gold dealers, paper traders, furniture makers—nobody is immune:

But these may not be simple cases of criminal extortion.  According to a recent Express Tribune article, “Also, during Eid, Mehsud tribesmen living in Karachi are forced to pay ‘bhatta’ in the name of donations for fighters in Waziristan. ‘Last Eid, we received reports that ‘parchiyaan’ (tickets)* were collected from each trader in Sohrab Goth (in Karachi) for this purpose,’ Shahid said.”  The Express Tribune refers to such collections as “illegal taxes.”  Some call them “jagga taxes.”

Bhatta may go against Pakistan’s criminal laws, but taxes against traders—both Muslims and infidels—are required under Islamic law.  Customs duties on articles of trade are regarded as a type of zakat.

* A parchi is a slip of paper with an extortion demand.


Columbus knew the dangers of the Muslim tax man

October 11, 2010

Time for a short Columbus Day history lesson. 

Christian Constantinople fell to the Muslim Ottoman Empire in 1453.  The Ottomans had also gained control of the vital Silk Road to the Far East.  What did this mean for Christian Europe and the soon-to-be discovered Americas?  Prof. Cynthia Smith of the University of Hawaii describes it very well:

There is one final consequence of Ottoman expansion and control, perhaps the most important from the perspective of world history. The Ottoman Empire, by the end of the 15th century, controlled the Near East and Eastern Mediterranean region. This meant control of the land routes linking the Silk Road connections between Asia and the Mediterranean. Control of East/West trading connections enabled Ottoman leaders to levy taxes on all goods moving East and West through their territory. Thus, strategic control resulted in staggering wealth for the Ottoman Empire – wealth they enjoyed for centuries.

This control was, not surprisingly, a source of growing resentment on the part of the Europeans, especially after the 14th century, as commerce and trade became increasingly important to Europeans.  European merchants and leaders resented the loss of revenue due to heavy taxes, and European consumers of Asian goods resented the high prices. There was also religious strain felt by Christians who had to follow Muslim laws and policies to maintain their trading connections with the East. This resentment of what some Europeans called the “stranglehold” of the Ottoman Empire on international trade was a primary reason why political leaders, commercial interests, invested money in efforts to find sea routes to the markets and goods of the East – launching the epic changes brought about by European exploration and expansion in the late 1400’s and 1500’s.

In other words, the voyages that resulted in the European “Age of Discovery” or “Age of Expansion” were launched primarily by the desire to go around the Ottoman Empire.  The expansion of European global control and power that resulted from these early expeditions changed world history. Ottoman regional dominance, and European attempts to avoid that economic control, were the catalysts for European sea dominance, colonization, Western “discovery” of the American continent and the further increase of global interactions.

Whenever you pass through the jurisdiction of an ‘ashir, you pay taxes.  If you’re a foreign Muslim trader in a Muslim land you pay low customs duties.  When you’re a non-Muslim trader in a Muslim land, you pay the highest customs duty rates.  Vital European interests were incompatible with sharia extortion during the Age of Discovery.  How is it that we’ve forgotten what Columbus recognized 518 years ago?


Hizbul Islam’s revenue strategy

May 4, 2010

The fundamentalist group Hizbul Islam splashed onto the scene in Somalia in early 2009 and on the world stage last month with the high-profile invitation it extended to Osama Bin Laden. 

In a strategy reminiscent of the Taliban, Hizbul Islam’s rapid ascent has been funded by an aggressive reliance on traditional Islamic revenue streams like highway zakat and fida’ (Islamic ransom).

The Christian Science Monitor reported over the weekend that Hizbul Islam militants “have seized the main port used by Somali pirates.”  The piracy and ransom market in Haradhere, Somalia, has already evolved into a virtual “stock exchange” with complete with ransom brokers.  CSM speculates that Hizbul Islam may impose a harbor tax against the pirates to cut into the ransom racket.

Somalia’s other noteworthy Islamist force, Al-Shabaab, has been operating in Somalia since 2006.  Al-Shabaab was designated as a foreign terrorist organization by the U.S. State Department in 2008 and its leaders had their assets frozen by the U.S. Treasury.

Hizbul Islam’s leader, Sheik Hassan Dahir Aweys, was labeled a terrorist by the U.S. after 9/11, and his assets were frozen by a Treasury designation last month.  That move seeks to ensure that no Americans or U.S. banks are conducting business with Aweys.

Sheikh Hassan Dahir Aweys

Sheik Aweys: colonel, cleric, and Hizbul Islam's taxman

This is especially important given Aweys’s former involvement with the ruthless sharia Islamic Courts Union, a network funded by traditional Islamic sources.  A 2006 report from the Council on Foreign Relations found that the ICU received funds from checkpoint taxes, by gifts from Hezbollah (which is itself funded by the Shia khums tax), from Libya, from Yemen, from millions of dollars in zakat originating in Jeddah, Saudi Arabia, and was deeply engaged in the hawala remittance sector.  Aweys no doubt learned from his time at ICU how valuable zakat and hawala could be for funding sharia.

Even with this troubling background, no formal designation or asset freeze has been imposed against Hizbul Islam as a whole organization yet to my knowledge.  (Please contact us if this is incorrect.)

Great Britain has been criticized for taking until March of this year just to designate Al-Shabaab as a terrorist organization.  How much longer will it take the U.S. and the U.K. to designate Hizbul Islam, and how much jihadist wealth will Hizbul Islam have amassed by then?

We can’t afford to wait until 2011.


Somali truckers taxed by the ‘ashir

May 3, 2010

Somali truckers are living under a revived version of the medieval Islamic taxman—the ‘ashir.  Now they can relate to Afghan truckers.

Traders in khat, a Somali stimulant, are being stopped on public roads by the ‘ashirs of Hizbul Islam, a militant Islamist group.  Then they’re shaken down for customs duties which are a sub-category of zakat under traditional Islamic tax law.

From Radio Garowe on Apr. 18:

Hizbul Islam insurgents impose tax on khat trade

Somalia’s Islamist insurgent group Hizbul Islam has imposed tax on traders selling khat, a narcotic drug consumed widely in Somalia for its mild stimulant leaves, Radio Garowe reports.

The group ordered the vehicles carrying the commodity from rebel-held KM50 airstrip to the Mogadishu to pay 300,000 Somali shilling.

However, the traders have refused to adhere to the new order, saying the 100,000 Somali shilling fee they are current paying is even colossal.

“It is a plan meant to oppress the Khat traders, we cant pay the fee imposed by Hizbul Islam because we are in loss,” said Fartun Ahmed, one of the traders.

Several vehicles, which used to transport Khat from the airstrip, located south of Mogadishu and held by Al-Shabaab have been parked in protest in Afgoye town, where they used to be charged.

“We parked our vehicles, because we can’t pay the charges. We will continue with our strike until the new tax charges is lifted,” said Mohammed Hassan, whos is among the drivers.

A Hizbul Islam official said the money from the new tax charges would be used to renovate the dilapidated roads in the region, adding that the group would back down from the fee.

The consumption of the stimulant leaves is high in government-held areas in Mogadishu, however, according to a Garowe Online reporter, lack of the commodity in the streets and markets was felt all over the restive capital.

Unlike Hizbul Islam, the radical Al-Shabaab, which rules with strict interpretation of Islamic Sharia Law, has banned the commodity from most of the areas under its control.


Weekly definition: Dar al-Harb

February 21, 2010

In the Oxford Dictionary of Islam, John Esposito defines Dar al-Harb as “Territory of war. Denotes the territories bordering on dar al-Islam (territory of Islam), whose leaders are called upon to convert to Islam. Refers to territory that does not have a treaty of nonaggression or peace with Muslims; those that do are called dar al-ahd or dar al-sulh. Jurists trace the concept to Muhammad , whose messages to the Persian, Abyssinian, and Byzantine emperors demanded that they choose between conversion and war…”

Esposito offers further details that I have excluded for brevity and relevance.  He concludes his full definition by saying, “the concept has little significance today.”

If it has “little significance today” why do I bring it up?  It’s relevant in terms of Islamic tax policy.  A harbi is a person from Dar al-Harb.  (Wikipedia elaborates that, “a person from ‘Dar al-Harb’ is a ‘harbi’ is a term classically referring to those countries where the Muslim law is not in force.”)

As noted in our Islamic tax chart, harbi merchants are subject to higher customs duty rates than Muslims.  Tax discrimination against the harbi is a recurring theme in Islamic law.


Just got your 1040? Well set that aside & check out THIS tax chart!

January 10, 2010

Researchers periodically stumble upon Money Jihad searching for information about tax rates under Islam.  The search engines have sent us folks looking for information on things like “jizya rates, ” “hadith taxes” and “ushr tax.”

To help meet that need, and just as a handy reference for all of us, I’ve added a new Islamic tax chart page to the blog today breaking down the major types of taxes under Islam, who is subject to the tax, what kind of wealth is taxed and at what rates, whether any deductions or exemptions apply, when the taxes are due, and what the basis for the taxes are under Islamic law.

I’ve kept a draft paper copy of this chart on my desk for a while which has been invaluable.  So take a look!  You can click on the link within this post or on the “Islamic tax chart” link on the right-hand sidebar.


Another discriminatory Islamic tax?

December 13, 2009

Random House defines a customs duty as a toll “imposed by law on imported or, less commonly, exported goods.”  Islam defines a customs duty as another way to jack dhimmis.

Read the rest of this entry ?