Using untrue receipts to avoid taxes

20-2-2006 | IslamWeb

Question:

Can you tell whether the following transaction is permissible? There is an agency which donates several items including foodstuff to the poor and needy. For instance if the market value of a cookie pack is $5 but this agency buys it for only $1. If I give them $100 they buy 100 cookie packs and give me a receipt of $500 (as market value of 100 packs is 100x5=500). I can use this receipt for tax return purpose wherein I claim that I spent money on object worth $500 in charity. Of course the receipt does not mention that I spent only $100. Many people say this is a Halaal method. Kindly explain it.

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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 is His slave and Messenger. We ask Allaah to exalt his mention as well as that of his family and all his companions.

 

It is permissible to avoid illegal taxes with the method that you mentioned or other methods as a way of repelling harm. There is no sin on whoever does this. Nonetheless, if the taxes are legal, then it is not permissible to avoid them in any case.

The legal taxes are those which the government takes from wealthy people in case there is a shortage in the resources of the country, to an extent that the country is unable to provide public services, like digging wells, tarmacking roads, building hospitals and the like. In this case, it is permissible for the government to impose some taxes on people, each according to his ability, in order to provide those benefits. In such a case, it is not permissible for you or any one else to avoid paying tax if you are able to do so.

For more benefit, please refer to Fataawa 84560, 89947 and 90173.

Allaah Knows best.