In the first part of this series of articles, the Islamic economic system was compared with capitalism. This blog post will focus on income tax and VAT, and their prohibition in the Islamic Shari‘ah.
Income tax is a capitalist invention
Income tax began in Britain in 1799 as a temporary wartime measure, was abolished twice, was reintroduced permanently in 1842, spread across capitalist nation-states during industrialisation, and, in the UK, still legally requires an annual parliamentary vote to remain in force.
Income tax was a deeply controversial innovation when it was introduced by William Pitt the Younger. The public viewed it as intrusive, un‑English, and a violation of traditional rights.
The tax required unprecedented disclosure of private financial information, which was culturally shocking. This surveillance aspect triggered immediate resistance.
Income tax was justified as a temporary wartime measure, not a legitimate permanent tax – even supporters admitted it was an emergency exception.
Public hostility was expressed in newspapers and pamphlets, and by politicians who condemned the income tax as oppressive and morally unacceptable. The tax was seen as a breach of the social contract because it empowered the state to pry into private life.
There was widespread evasion, which reflected the population’s refusal to accept the tax as legitimate.
Income tax was abolished in 1802 due to overwhelming public pressure — a sign of how deeply people rejected the idea of taxing income.
The reintroduction of income tax in 1803 led to the immediate revival of public anger.
Income tax was associated with government overreach, and critics argued it violated English traditions of limited government.
The 1816 abolition of income tax led to public celebrations, which included the burning of tax records, a symbolic rejection of state intrusion.
In parliamentary debates, MPs condemned income tax as tyrannical and unjust.
The tax was considered morally wrong, not merely an economic burden.
Income tax became a political taboo for decades — no government dared reintroduce it because of its toxic reputation. It wasn’t reestablished until 1842. Income tax eventually became the foundation of the modern fiscal state, enabling massive expansion of government power.
Income tax created a culture of surveillance, audits, and financial policing.
Income tax is often seen as unfair, especially when progressive rates punish productivity.
Income tax has always been one of the most hated taxes in every country that adopted it. Income tax became a symbol of state intrusion and loss of personal autonomy.
Opposition to the payment of income tax was expressed by the refusal to pay by different groups in many countries.
At open-air “monster” meetings in Tasmania in early 1904, people vowed to resist an income tax that had been instituted by the recently ousted government but unexpectedly not rescinded by the new one.
In Darwin (Northern Territory, Australia) in early 1919, citizens organised an income tax strike and a boycott of the local (taxed) alcohol monopolist, John Gilruth, who was also the Administrator (governor). The resistance continued until Gilruth fled Darwin.
Also in 1919, miners in Wales went on strike rather than pay the income tax, which was newly being applied to incomes below £200.
In the Dutch West Indies in 1921, residents resisted an income tax from which Dutch settlers were exempt, then successfully disrupted an auction at which a resister’s goods were being sold for back taxes.
In 1922, Syndicalist groups in France promoted income tax evasion and defended evaders whose goods were in danger of government seizure.
Tax resistance campaigns sporadically broke out in Germany between the world wars, including a tax strike in Württemberg, Stuttgart, Cologne, Essen and other areas in 1920, an income tax strike by Prussian farmers in 1922, and the tax strikes of the Rural People’s Movement (Landvolkbewegung) in Schleswig-Holstein from 1928.
In 1936, in what one author called “the first truly grassroots rebellion/uprising by Palestinians,” activists called for a general strike and tax strike to protest against the British mandate.
Between 1939 and 1948, there was widespread resistance by Jews in Palestine against the income tax imposed by the British authorities, which included bomb attacks against tax offices.
For more on the widespread opposition to income tax, refer to Rebellion, Rascals and Revenue (2021) by Joel Slemrod & Michael Keen.
Normative Islam Prohibits Income Tax
Income tax is ḥarām, a form of ẓulm (oppression) and a major sin. This is clear and irrefutable. Despite this, some modernist scholars employed by the illegitimate governments of Muslim countries have claimed that income tax is lawful. We present below the normative view based on the Sunnah and the statements of the classical scholars.
Imam al‑Dhahabī (died 748AH) on al‑Muks (Unlawful Taxation)
وَالمَكْسُ مِنْ أَعْظَمِ الظُّلْمِ، وَصَاحِبُهُ مِنْ أَكْبَرِ أَعْوَانِ الظَّلَمَةِ،
بَلْ هُوَ مِنْهُمْ، بَلْ هُوَ أَظْلَمُ مِنْهُمْ، لِأَنَّهُ يَأْخُذُ مَا لَا يَسْتَحِقُّهُ،
وَيَظْلِمُ النَّاسَ فِي أَمْوَالِهِمْ، وَقَدْ قَالَ النَّبِيُّ ﷺ:
«لَا يَدْخُلُ الْجَنَّةَ صَاحِبُ مَكْسٍ».
“Muks (unlawful taxation) is among the gravest forms of injustice. The one who imposes it is among the greatest helpers of oppressors— rather, he is one of them; indeed, he is even more unjust than they are, because he takes what he has no right to take and wrongs people in their wealth. The Prophet ﷺ said: ‘The collector of muks will not enter Paradise*.’”
[Imam Shams al-Din al-Dhahabi, Kitab al‑Kabāʾir (Book of Major Sins), Dār al‑Kutub al‑ʿIlmiyyah, Beirut,pp. 109-110]
*[Narrated by ‘Uqbah ibn ‘Āmir – Sunan Abu Dawud #2937 and Musnad Ahmad #17333. Declared authentic by al-Haythami in Majmaʿ al‑Zawāʾid 10/341]
Classical Definition of Muks
The term muks is defined consistently across early and later sources:
Abū ʿUbayd (d. 224 AH)
«المَكْسُ: ما يأخذه السلطان من أموال الناس بغير حقٍّ في كتابٍ ولا سنة.»
“Al‑muks is what the ruler takes from people’s wealth without a right established in the Book or Sunnah.”
[Abū ʿUbayd, al‑Amwāl, ed. al‑Qaṭṭān, p. 593]
Abū Yūsuf (d. 182 AH)
«ليس للإمام أن يُحدِث ضريبةً ليس لها أصل في كتابٍ ولا سنة.»
“The Imam has no right to impose a levy for which Allah has revealed no authority.”
[Kitāb al‑Kharāj, ed. al‑Najjār, p. 125]
al‑Ghazālī (d. 505 AH)
وَمِنَ الْمَكَاسِبِ الْمُحَرَّمَةِ الْمَكْسُ، وَهُوَ مَا يُؤْخَذُ مِنَ التُّجَّارِ وَغَيْرِهِمْ بِغَيْرِ حَقٍّ، وَهُوَ مِنْ أَفْحَشِ الظُّلْمِ.
“Among the prohibited earnings is muks, which is what is taken from traders and others without right, and it is among the most heinous forms of injustice.”
[al‑Ghazālī, Iḥyāʾ ʿUlūm al‑Dīn, vol. 2 p. 93]
al‑Juwaynī (d. 478 AH)
وَأَمَّا إِحْدَاثُ الْمَكُوسِ فَلَا يَحِلُّ بِوَجْهٍ، فَإِنَّهُ أَخْذُ أَمْوَالِ النَّاسِ بِغَيْرِ حَقٍّ، وَهُوَ مِمَّا أَجْمَعَ الْمُسْلِمُونَ عَلَى تَحْرِيمِهِ.
“As for instituting mukūs, it is not lawful in any way, for it is taking people’s wealth without right, and it is among what the Muslims have unanimously declared forbidden.”
[al‑Juwaynī, Ghiyāth al‑Umam, vol. 1 p. 237]
Ibn Taymiyyah (d. 728 AH)
«ما يُؤخذ من الرعية بغير حقٍّ شرعي فهو حرام، وهو من أعظم الظلم.»
“Any wealth taken from subjects without Sharīʿah authorisation is ḥarām and among the greatest forms of injustice.”
[Majmūʿ al‑Fatāwā, 29:251]
Ibn Ḥajar al‑ʿAsqalānī (d. 852 AH)
«صاحب المَكْس من أشد الناس وعيدًا في السنة.»
“The collector of muks is among the most severely condemned in the Sunnah.”
[Fatḥ al‑Bārī, 4:410]
Ibn Ḥazm (d. 456AH)
وَكُلُّ مَالٍ أُخِذَ مِنْ أَحَدٍ بِغَيْرِ نَصٍّ مِنْ قُرْآنٍ أَوْ سُنَّةٍ صَحِيحَةٍ فَهُوَ ظُلْمٌ مَحْضٌ، وَصَاحِبُهُ غَاصِبٌ آثِمٌ، وَالْمَكُوسُ كُلُّهَا مِنْ ذَلِكَ، لَا يَحِلُّ شَيْءٌ مِنْهَا.
“Every wealth taken from anyone without a text from the Qur’an or authentic Sunnah is pure injustice; its taker is a usurper and sinner. All mukūs are of this, and none of them is lawful.”
[Ibn Ḥazm, al‑Muḥallā bi’l‑Āthār, vol. 8 p. 168]
Ibn ʿĀbidīn (d. 1252 AH)
وَأَمَّا الْمَكُوسُ الَّتِي يَأْخُذُهَا السُّلْطَانُ مِنَ التُّجَّارِ فَهِيَ حَرَامٌ بِالْإِجْمَاعِ، لِأَنَّهَا أَخْذُ مَالِ الْغَيْرِ بِغَيْرِ حَقٍّ.
“As for the mukūs which the ruler takes from traders, they are ḥarām by consensus, because they are taking another’s wealth without right.”
[Ibn ʿĀbidīn, Radd al‑Muḥtār ʿalā al‑Durr al‑Mukhtār, vol. 4 p. 262]
These definitions match modern income tax precisely: a recurring, compulsory levy on wealth without a textual basis.
Modernist arguments in support of income tax
Modernist scholars typically justify income tax by arguing that it serves maslaḥah—a necessary public interest that enables the state to provide essential services—and that it can be analogised to historical fiscal tools like kharāj, which they interpret as evidence of flexible state authority. They claim that classical prohibitions on muks targeted corrupt, arbitrary exactions rather than taxes approved by parliamentary legislation and subject to public oversight. Some also argue that when financial shortfalls stem from state mismanagement, the solution is institutional reform rather than declaring taxation unlawful, and that a transparent income tax that has public consent differs fundamentally from the oppressive levies condemned by classical jurists.
These scholars resort to maṣlaḥah mursala to justify income tax. However, maṣlaḥah is invalid when it contradicts text:
Al‑Qarāfī states:
«كل مصلحةٍ تُخالف نصًا أو إجماعًا فهي باطلة.»
“Any maṣlaḥah that contradicts a text or consensus is invalid.”
(al‑Furūq, 1:177)
Since muks is prohibited by text and consensus, maṣlaḥah cannot justify it.
State mismanagement is not a Sharʿī justification
Abū Yūsuf warns:
«لا ينبغي للإمام أن يُثقِل على الرعية بسبب سوء تدبيره.»
“The Imam must not burden the subjects because of his own mismanagement.”
(Kitāb al‑Kharāj, p. 90)
Modern income tax often funds:
- interest‑based debt
- bureaucratic expansion
- non‑Sharʿī expenditure
Refutation of the Analogy (Qiyās) to Kharāj
Kharāj is tied to land, not labour.
Abū Yūsuf defines kharāj as:
«الخراج حقٌّ على الأرض المفتوحة عنوة أو صلحًا.»
“A [levy] due upon land conquered by force or surrendered by treaty.”
(Kitāb al‑Kharāj, p. 47)
Income tax targets:
- wages
- salaries
- profits
- personal labour
This is a different genus, rendering the analogy invalid (qiyās maʿa al-fāriq).
Refutation of the “Consent of the People” Argument
Consent cannot legalise the prohibited.
Ibn Ḥazm states:
«اتفاق الناس لا يُحلّل ما حرّم الله.»
“Agreement of people cannot make the prohibited lawful.”
(al‑Iḥkām fī Uṣūl al‑Aḥkām, 6:83)
Even unanimous consent cannot legalise muks.
Parliamentary approval is not Sharīʿah approval
Sharīʿah recognizes:
- Qurʾān
- Sunnah
- Ijmāʿ
It does not recognise:
- parliamentary legislation
- majority votes
Thus, approval by parliament/assembly does not affect the ruling.
Conclusion
Modern income tax fulfils every classical criterion of muks:
- Not legislated by Qurʾān or Sunnah
- Recurring and compulsory
- Taken from wealth and labour
- Imposed by the ruler’s discretion
- Requires intrusive disclosure
- Permanent, not temporary
Given the explicit prophetic condemnation of muks and the unanimous position of early jurists, modernist attempts to justify income tax by reference to maṣlaḥah, analogy, or parliamentary votes fail to meet the standards of uṣūl al‑fiqh (the principles of Islamic jurisprudence).
Therefore:
Modern income tax = muks = ḥarām according to the classical, normative Islamic view.
The Normative Islamic Position Regarding VAT
VAT is a consumption tax imposed by the state on the sale of goods and services at each stage of production. It is not a tax on income, wealth, or property, but on transactions.
VAT is a form of muks – an unlawful tax taken on trade routes, markets, or sales.
Arguments that VAT resembles Muks
Many contemporary scholars argue VAT is ḥarām because:
- It is a tax on trade, like muks.
- It is repeated at multiple stages.
- It increases prices for consumers without Sharʿī justification.
- It is not tied to public services directly.
- It is compulsory, not voluntary.
This is the position of many scholars in the Gulf, North Africa, and South Asia who classify VAT as a modern form of muks.
From a purely classical fiqh perspective, VAT matches the definition of muks:
- It is a levy on trade
- It is repeated
- It is not tied to a specific Sharʿī cause
- It is not zakāt, ṣadaqāt, kharāj, ʿushr, jizya, khums or fay’
- It increases the burden on merchants and consumers
Thus, according to classical jurists, VAT would be considered ḥarām.
In the next part of this series of articles, we will examine property and resource ownership in the Islamic Caliphate.
The Caliphate 