Zakat on Sharia-Compliant Stocks: A Normative Framework for Contemporary Islamic Finance

Abstract

The integration of sharia-compliant equities into global financial markets necessitates a reevaluation of zakat obligations within Islamic fiscal jurisprudence. Classical zakat categories addressed tangible assets, but the modern proliferation of stock ownership presents new challenges for Islamic legal and economic scholars. This study constructs a normative framework for zakat on sharia stocks by synthesizing classical fiqh, maqāṣid al-sharīʿah, and the structural realities of corporate finance. Utilizing a qualitative, document-based methodology, it examines traditional concepts such as māl, niyyah, ḥawl, and ʿurūḍ al-tijārah to assess their applicability to modern equity ownership. Findings suggest that stock zakatability depends on ownership intent and asset classification, with appropriate models including market value for trading stocks and net asset value for investment stocks. The study also proposes a hybrid institutional model combining personal accountability with corporate facilitation for effective zakat administration. This dual approach aligns doctrinal integrity with regulatory pragmatism, enhancing zakat’s function as a tool for wealth redistribution and ethical governance in Islamic finance. The framework offers theoretical depth and policy relevance for scholars, regulators, and Islamic financial institutions striving for zakat standardization and operational efficiency.