Role of Fiscal Policy in Islamic Economics

Role of Fiscal Policy in Islamic Economics - Fiscal policy is an important component of public policy. Fiscal policy includes government policies in the three following points. The first revenue policy in a modern economy focused more on tax policy. The second instrument is the Government spending policy and the third is owed. The role of fiscal policy in an economy is determined by Government involvement in economic activity, which is determined by the socio-economic situation, ideological commitment, and the nature of economic systems.

On the Socialist economic system of the public sector are all controlled by the Government. In the capitalist system, the role of the public sector is relatively small but very important. On the economic system of Islam, the right of private ownership is recognized; the Government is responsible for ensuring the appropriateness of living of its citizens. This is a commitment not only to achieve continuity (Division) for the most economic community large numbers, but also help improve the spiritual and spread the message and teachings of Islam as wide as possible.

Some important things in Islamic Economics for situational setting fiscal policy is as follows:
  1. Ignore the State of the economy, government monopolies fiftieth Muslims must guarantee that the tithes collected from Muslims who own property exceeds nisab and used for the purpose for which specialized in Scripture verses.
  2. The interest rate does not play a role in the economic system of Islam. These changes naturally not only on monetary policy but also on fiscal policy. When it reaches the level of interest in the money market balance will not be started, some of the alternatives must be found. One alternative is to set the tool making the amount of money is Idle.
  3. When all loans in Islam are free-interest, government spending will be financed from the collection of taxes or for the results. Therefore, the size of the public debt becomes smaller.
  4. Monopolies attempted to assist or support economically backward Muslim community and spreading the messages of the teachings of Islam. So, government spending will be directed on increase of activities and enhance understanding of Islam Muslim community welfare is still underdeveloped. The payment of taxes in Islamic Economics as part of efforts to develop Islam.
  5. The Islamic State is a prosperous country, where the well-being of the broad meaning of has 1.8 on a Western concept. Well-being includes spiritual aspects and material aspect with greater emphasis on spiritual content. Islamic countries are responsible for protecting citizens, religious life, offspring and property. So, everything that indirectly improve the stuff.
  6. At the time of the war, Islamic hope people it gives not only life, but also all his possessions to keep religion.
  7. Rights of taxation in the State of Islam are not limited. Some people say that taxation policy outside the so-called religious obligatory, it is not possible unless it is in a particular situation.

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