A message for the people of my generation

Do you have a university degree or are in the process of getting one? Did you start your career? If any of these criteria apply to you then this write up is meant for you. Regardless of your social and financial status, you still fall in the privileged class of the society. You might have worked very hard for reaching this stage but you CANNOT deny the contribution of luck and the millions of people working at minimum wages. Directly or indirectly, society did have an impact on your good fortunes. If you agree with me so far then you MUST show your gratefulness by giving back to the society. There are many ways of doing that but for now I want to talk about Zakat and Taxes.

Why should I give Zakat? I should give Zakat because it is not fair that some people are wasting their wealth while others are deprived of basic needs. I can give hundreds of more reasons but that is not necessary. Only additional comment I want to make about Zakat (I am not an Islamic Scholar so I am saying things from common sense) is that the intention is more important that the outcome. There is no hard and fast rule that one only gives 2.5% of liquid assets as Zakat. Why would you not give more if you can afford to give more? We frequently make up strange logic (cognitive dissonance) in our head and using that logic we try to justify that Zakat does not apply to us. These self made theories are utter bullshit. Today we might be the one in a position to give Zakat. Tomorrow, we can easily be the ones who would need the assistance.

Now, let me come to the issue of “Income Tax”. Less than 2% of the population pays taxes in Bangladesh. Income tax to GDP is probably one of the lowest in the world. This is pathetic. Why are we not paying our taxes? Firstly, we are not paying taxes because we are greedy. Secondly, we say that the government is corrupt and whatever money we are pay as taxes will go to their pockets. When I thought about the latter argument I found that this has no logical basis. If we can give vote to the two major parties we cannot say that they are corrupt and hence evade/avoid taxes. Also, we are using all the facilities that the state is providing using the money given by actual tax payers. We are using the roads, the street light, the public parks, enjoying the subsidies that government provides and what not.

Let us stop feeding ourselves all these lies just because we have become materialistic and greedy. Let us give the Zakat properly and if possible more than 2.5%. Let us pay our taxes properly and then fight for our right to information and transparency. We are accountable for our responsibilities as citizens and government is accountable for their parts. Allah would not make us responsible for the corruption done by the government but would definitely make us responsible if we are enjoying the benefits of taxation but not paying our taxes. In the worst case scenario, if you are adamant that you would not pay taxes then at least calculate your taxes and give that to people directly as charity. Once we are fulfilling our responsibilities let us go to our family and relative and ask them whether they are giving Zakat and paying taxes properly.

Asif Khan, CFA

Asif Khan is presently a Research Analyst (Financial Sector) for Exotix which is a frontier market focused investment bank. He has more than 6 years of work experience as equity analyst in both buy and sell side roles across Asian frontier markets. Asif is a CFA Charterholder and has a dual major in Finance & Economics from North South University.

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