IslamicFinance.de

In July, a group of 83 of the world’s richest people calling itself Millionaires for Humanity urged governments to increase taxes on them to help deal with the economic fallout from the COVID-19 pandemic. Their idea, the latest version of a wealth tax was received as almost revolutionary. Although wealth taxes may seem bold and innovative, however, the concept is almost as old as money itself. Since the ancient Greeks there have been wealth taxes in various countries right through to the present day. More recently than the ancient Greeks, a wealth tax has been foundational to Islamic practice. The zakat functions as a 2.5% wealth tax on liquid assets. Modern wealth taxes have often failed because they haven’t learned from their historical equivalents.