All states rely on law to legitimize their claims to land and resources, and the Islamic State is no exception. In the absence of a legal foundation for economic activity, taxation is indistinguishable from extortion. This similarity has been noted by the sociologist Charles Tilly, who famously analogized the process of state formation to “organized crime”and argued that states are merely “protection rackets” in which citizens consent to taxation and other duties in exchange for security and services. The fine line between legitimate and criminal forms of resource extraction explains why the same activities described by ISIS as “taxation” or “commerce” are perceived by Western observers as “smuggling,” “theft,” and “trafficking.” In this post, I explain how ISIS is utilizing Islamic law and scripture to justify economic activities that might otherwise resemble organized crime.
Through its emerging jurisprudence on economics and public finance, ISIS claims to be establishing a law-based social contract in which Muslims consent to pay taxes and mandatory charitable contributions (zakāt) in exchange for the protections and benefits to which subjects of the Caliphate are entitled. Previously, I argued that ISIS purports to be creating a system of accountable governance based on reciprocal rights and obligations between the caliph and the people. The ISIS social contract guarantees a limited number of legally enforceable rights—for example, the right to file complaints or charges against ISIS combatants or officials—in addition to welfare services, public institutions, and police protection. In exchange for these benefits, subjects are expected to pay taxes to the state treasury (bayt al-māl) and comply with the many other rules of residence in the Caliphate.
To justify its imposition of taxes and expropriation of conquered lands, ISIS is developing an Islamic economic jurisprudence based on a selective (and arguably creative) reading of divinely revealed texts and later commentary by medieval scholars such as Ibn Taymiyyah. By invoking the terminology of the Islamic financial systems that originated during the lifetime of the Prophet, ISIS is trying to lend historical authenticity and legitimacy to extractive (and therefore potentially unpopular) institutions such as taxation.
Ibn Taymiyyah argued that the sharia provides for three main sources of public revenue that are explicitly described in the Quran: zakāt, ghanīma, and fay’. All three of these terms are regularly cited in ISIS propaganda, fatwas, and other official documents.
Zakāt refers to a compulsory charitable contribution based on a percentage (traditionally 2.5 percent) of a Muslim’s total income and savings. The Quran specifies eight categories of people who are eligible for public benefits funded by zakāt [9:60]. In addition to capital assets, zakāt can also be levied on other material possessions such as agricultural holdings and livestock. For example, this document from ISIS-controlled Aleppo refers to a zakāt tax on barley and wheat.
Ghanīma refers to moveable property that has been forcibly taken from non-Muslims in the course of a military campaign, such as slaves and weapons. ISIS frequently refers to seized munitions as ghanīma, as in this propaganda document cataloging a stockpile of weaponsseized north of Baghdad. Jurists have interpreted the Quran as requiring that one-fifth (a quantity defined as “khums”) of ghanīma must be allocated to the treasury of the Islamic state, implying that the remaining 80 percent of spoils may be distributed among the military commanders and fighters responsible for the victory.
The related concept of fay’ refers to land or tribute acquired peacefully from unbelievers without a fight. Historically, fay’ was institutionalized through jizya (a tax that non-Muslims were required to pay in exchange for the protection and services provided by the Islamic state) and khāraj (a tax levied on the proceeds from agricultural lands).
Although there is an explicit Quranic basis for zakāt taxes and the khums tax on war booty (ghanīma), the Quran says much less about the taxes that have been developed to allocate the nonviolently acquired fay’ spoils. Jizya is mentioned briefly at 9:29, but the Quran contains no references to khāraj—which was a later innovation.
Since the divinely revealed texts provide only vague guidance on tax policy, taxation has been an area in which previous caliphates and now ISIS have wielded considerable discretion according to the doctrine of siyasa sharʿiyya, which delegates to Islamic governments a limited authority to develop man-made regulations that are consistent with the ultimate law of God (sharia). As an example of the flexibility with which scholars have approached questions of taxation, Yusuf al-Qaradawi has argued that an Islamic state is entitled to impose additional, discretionary taxes if the proceeds from the three main sharia sources of revenue (zakāt, ghanīma, and fay’) are insufficient to sustain governance, citing the principle of usūl, which states, “Something without which an obligation cannot be fulfilled is also obligatory.”
ISIS operates numerous zakāt offices that collect and redistribute contributions in the form of cash as well as agricultural surplus. In addition, ISIS collects jizya taxes from Christians(reportedly at a rate ranging from one to four dinars annually, depending on income) andphotographs of alleged jizya tax receipts have appeared on Twitter. However, the revenues generated from zakāt (at the modest rate of only 2.5 percent) and jizya (imposed on an already tiny minority group whose population is rapidly dwindling in ISIS-controlled areas) are not commensurate with the needs of an expanding state that already controls an estimated 35,000 square miles of territory and is engaged in costly military campaigns on multiple fronts.
Therefore, ISIS has found it necessary to develop legal justifications for taxes that are not explicitly defined in Quran or Sunnah, such as the khāraj land tax and ’ushr, an import-export tariff on cross-border trade that was first introduced by the Caliph Umar in the seventh century to counter similar taxes imposed on Muslims by neighboring states. Historically, a 10 percent ’ushr tax was imposed on non-Muslim foreign traders, while Muslims and local non-Muslims were taxed at lower rates of 2.5 percent and 5 percent respectively. Photographs of tax receipts for imported goods suggest that ISIS is collecting’ushr taxes in a similar manner.
The khāraj tax on land is another important source of revenue. Although ISIS prefers that Muslims earn a living “by performing jihad and then taking from the agriculture of his kafir enemies, not by dedicating his life to agriculture like his enemies do,” it notes that farming is a mubāh (permissible) form of work as long as the proceeds are subject to khāraj taxes. Taxation, therefore, is the mechanism that legitimizes vocations other than jihad by diverting a share of the profits to support state-building and conquest.
In general, ISIS appears to be taking advantage of the ambiguity of scriptural guidance on taxation and public finance by cherry-picking (and sometimes mixing and matching) the concepts and arguments that best support its strategic objectives. This emerging economic jurisprudence provides a legal basis for channeling the spoils of war into public services and institutions that win favor with civilians and create incentives for cooperation with ISIS. For example, a statement issued in Raqqa in May 2014 cites Surat al-’Anfāl [8:41] to announce the opening of a new office for the care of orphans funded by the proceeds of fay’ andghanīma.(It has been noted elsewhere that ISIS takes a special interest in orphans in order to train them as child soldiers.) The statement notes that the amount of public funds to be allocated to orphanages has not been “fixed” at a specific value, but will fluctuate in proportion to the spoils of war. Such policy statements indicate that ISIS is exercising substantial discretion and flexibility in its expenditures of revenues derived from war booty to finance welfare institutions and social services.
Other doctrinal statements appear to take interpretive liberties in providing sweeping justifications for ISIS’s seizure of property and assets in the name of providing for the material needs of the Muslim community. For example, fatwa 35 in the series previously discussed by Cole Bunzel addresses the question: Should hard currency obtained in the course of jihad be treated as fay’ or zakāt? The fatwa concludes that currency acquired from the hands of apostates through jihad cannot rightfully be considered zakāt, since zakātis an obligation imposed on Muslims, and must therefore be treated as fay’ subject to the 20 percent khums tax. The legal reasoning is questionable and possibly inconsistent with another fatwa in the same series (36), which suggests that the duty to levy zakāt is not invalidated by apostasy. Whatever the merits of the argument, it is clear that from a strategic standpoint, ISIS could substantially increase its revenues by designating spoils of war as fay’ (and therefore taxable at a rate of 20 percent) rather than zakāt (taxable at the substantially lower rate of 2.5 percent), and it is not surprising to find that ISIS’s economic jurisprudence appears to be shaped by its own financial incentives.
Fatwa 36, mentioned above, does allow for the imposition of zakāt taxes on some of the agricultural holdings that previously belonged to an apostate, however the remainder of the apostate’s property (i.e. everything not subject to zakāt) must also be deposited in the public treasury, since apostates are not allowed to inherit land. Furthermore, if the land was seized by an apostate who fled to the Abode of Unbelief (dar al-harb), then all of his possessions, including his agricultural holdings, are appropriated by the state as fay’. Ultimately, in any scenario envisioned by this fatwa, 100 percent of an apostate’s land becomes the property of the Caliphate, whether as zakat or fay’. Again, ISIS’s economic jurisprudence appears to be designed to facilitate the conversion of war booty into public revenue.
Additionally, ISIS appears to be structuring its economic jurisprudence to create incentives for martyrdom by protecting the inheritance rights of the families of fighters. For example,fatwa 59 states that when a mujāhid dies in the course of battle after war booty has already been captured, then the martyr’s heirs are entitled to inherit his share of the spoils.
Finally, ISIS uses its economic jurisprudence to recharacterize dubious and even criminal activities as Islamically legitimate acts of jihad. For example, fatwa 66 claims that taking money from one’s father with the intent of emigrating to the Abode of Islam (dar al-Islam) does not constitute theft, since the father has failed to discharge his divine obligation to financially support his son’s departure from the Abode of Unbelief.
In conclusion, ISIS is using Islamic legal arguments to justify and legitimize the extractive economic policies that are necessary for state-building and territorial conquest. But while ISIS goes to great lengths to portray its economic institutions as “Islamic” by anchoring them in the text of Quran, I argue that these institutions are being shaped much more by raw strategic interests than they are by religion. In any state, whether religious or secular, economic institutions are deeply intertwined with political and military objectives. In order to justify extractive policies like taxation or conscription (which are necessary for territorial expansion and governance, but may nonetheless be unpopular with the public) policy makers must convince people—by appealing either to science, religion, morality, or some other persuasive belief system—that it is in their interests to contribute financially or even risk their lives on behalf of the state.
For this reason, ISIS’s selective reliance on aspects of Islamic scripture that support its economic objectives is unsurprising and in fact very consistent with the practices of other militarized states. But given the fine line between taxation and extortion, it may become increasingly difficult to sustain the pretension of an Islamically legitimate economy to its followers and sympathizers if it appears that ISIS is disingenuously cobbling together a piecemeal jurisprudence that is instrumentally designed to advance political and military objectives.
This article was originally published by Brookings.