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Available. Open Access. Open Access
Article
Publication date: 4 December 2017

Burhanuddin Lukman and SabaRadwan Jamal Elatrash

This paper aims to ascertain the Sharīʿah (Islamic law) stance on the imposition of goods and services tax (GST) on tabarruʿ-based takāful (donation-based Islamic insurance…

3158

Abstract

Purpose

This paper aims to ascertain the Sharīʿah (Islamic law) stance on the imposition of goods and services tax (GST) on tabarruʿ-based takāful (donation-based Islamic insurance) products in Malaysia. The paper aims to do so by analysing the philosophy, purposes and structure of GST on takāful products and comparing the imposition of GST on tabarruʿ-based takāful with its imposition on conventional insurance while probing into the Sharīʿah texts and opinions of classical and contemporary scholars about taxation in Islam.

Design/methodology/approach

The paper uses a qualitative research methodology. In addition to the literature and text on websites, the information on how GST is applied in practice is also obtained through interviews, discussions and documents from takāful operators. To determine the Sharīʿah position on GST, reference has been made to classical and contemporary Sharīʿah literature, including local and international Sharīʿah advisory bodies’ resolutions and standards.

Findings

This study finds that a strict interpretation of Sharīʿah does not allow for the imposition of GST; however, there is still room for the government to justify it using a broader interpretation of maṣlaḥah (public interest). Takāful has become a need for the society and is subscribed to by all income groups, and not only by the rich. Hence, the government should consider exempting takāful products from GST. The basis of tabarruʿ in takāful does not provide conclusive Sharīʿah evidence for takāful to be exempted from GST.

Originality/value

This research paves the way for the industry to propose further measures on GST for takāful products such as the exemption of GST on the tabarruʿ amount or imposition of a zero rate of GST on the relevant takāful fees and charges that are currently burdensome to consumers.

Details

ISRA International Journal of Islamic Finance, vol. 9 no. 2
Type: Research Article
ISSN: 0128-1976

Keywords

Available. Open Access. Open Access
Article
Publication date: 19 June 2018

Sa’id Adekunle Mikail, Noor Suhaida Kasri, Saba Radwan Elatrash and Abideen Adeyemi Adewale

This paper aims to examine the existing practices and pertinent issues affecting Islamic banks and their customers in abandoned housing projects (AHPs) to ensure compliance with…

2498

Abstract

Purpose

This paper aims to examine the existing practices and pertinent issues affecting Islamic banks and their customers in abandoned housing projects (AHPs) to ensure compliance with Sharīʿah and statutory requirements.

Design/methodology/approach

This study employs the qualitative research method using the inductive approach to analyze both primary and secondary data and sources. Data collection involved a series of semi-structured interviews with five volunteering Islamic banks and a representative of Abandoned Property Owners Association Malaysia (Victims). Statutory acts, regulatory policies, guidelines, directives and standards were also analyzed.

Findings

The result indicates developer’s default, underlying contracts, regulatory arbitrage and bureaucracy, attitudinal disposition of customers and sell-then-build approach as major factors of AHP’s conundrum.

Practical implications

This study has suggested both short- and long-term solutions based on the principles of justice, public interests and removal of hardship to resolve and effectively manage financial hardship indebtedness arising from housing abandonment. Further, part of the proposed solutions would also reshape housing development policies and home financing transactions.

Originality/value

The quest for this research demonstrated Islamic banking industry’s initiatives to find lasting solutions to perennial issues of AHPs.

Details

ISRA International Journal of Islamic Finance, vol. 10 no. 1
Type: Research Article
ISSN: 0128-1976

Keywords

Available. Open Access. Open Access
Article
Publication date: 19 June 2018

Ashraf Md. Hashim

723

Abstract

Details

ISRA International Journal of Islamic Finance, vol. 10 no. 1
Type: Research Article
ISSN: 0128-1976

Available. Open Access. Open Access
Article
Publication date: 4 December 2017

Ashraf Md. Hashim

707

Abstract

Details

ISRA International Journal of Islamic Finance, vol. 9 no. 2
Type: Research Article
ISSN: 0128-1976

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