Ruling on lying to reduce tax

2-4-2013 | IslamWeb

Question:

What would be the ruling if a client asks me to reduce the value of the goods in an invoice so as to lessen the taxes imposed on him since it is estimated according to the price mentioned in the invoice? Meaning that the price stated in the invoice is less than the real one. Is this considered a form of cheating?

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Answer:

All perfect praise be to Allaah, The Lord of the worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ‘alayhi wa sallam, is His slave and messenger.

If the taxes are unjust and unfair, then it is permissible to cooperate in cancelling and evading them. This is not considered a form of cheating but rather a form of supporting the oppressed. It is reported that the Messenger of Allaah, sallallaahu ‘alayhi wa sallam, said: "Support your brother whether he is an oppressor or the oppressed." [Al-Bukhari and Muslim]

As-Saawi, the Maaliki scholar said: "Lying is prohibited." Then he said: "It should be known that lying is subject to the rulings of Fiqh, so it is obligatory in cases where it is necessary to save an inviolable life or wealth from an oppressor."

There is no doubt that if taxes are imposed upon people without an acceptable reason in the sight of Sharee‘ah, then it is a form of injustice and transgression. Hence, if lying becomes necessary to cancel or reduce them, then it is required under Sharee‘ah. However, if the taxes are acceptable under Sharee‘ah, then it is impermissible to withhold or evade them. Resorting to lying and cheating to achieve this is impermissible as well.

Allaah Knows best.