MMA made custodian of Zakat Fund

President Dr. Mohamed Muizzu on Saturday ratified legislature making the Maldives Monetary Authority (MMA) the custodian of the Zakat Fund.

The government’s zakat bill, sponsored by Vilufushi MP Hassan Waheed, was passed by the Parliament with a unanimous vote of 63 last week.

It was ratified by President Muizzu on Saturday morning, and is set to take effect on January 1.

According to the President’s Office, the purpose of the new legislature is to establish the legal framework governing the zakat system in the Maldives, ensuring the effective organization and regulation of the payment, receipt, and distribution of zakat in order to fulfil the objectives prescribed in Islam.

The legislature prescribes the establishment of a Zakat Fund to safeguard zakat contributions, distribute them to eligible beneficiaries, and invest the funds in accordance with Islamic Shariah. The Fund will be maintained in a dedicated account established with the MMA, separate from the public bank account, as determined by the Ministry of Finance.

The MMA will serve as the custodian of the Zakat Fund.

With the establishment of the Zakat Fund, the Zakat Fund previously created under the Public Finance Act will be transferred together with all monies held therein to the Fund established under this Act.

Under the legislature, the national zakat policy, including the collection and distribution of zakat assets, shall be determined by the President on the advice of the minister responsible for matters relating to Islam. The President shall also establish a Zakat Council to advise the Minister and the Maldives Zakat House on the administration of the Zakat system.

Once the new legislature takes effect next year, the Maldives Zakat House will become a government agency under the Islamic Ministry. All responsibilities, duties, assets, facilities, and budgetary funds previously allocated to the Maldives Zakat House, along with all rights and benefits granted to it by law or agreements, will be transferred to the newly established agency.

A Shariah Advisory Committee, appointed by the President, will provide Shariah guidance and oversight in matters relating to the formulation and implementation of the zakat system.