Is There Zakah on Oil?

11 October, 2021
Q Is Oil Included in the Zakatable Items?

Answer

In the Name of Allah, Most Gracious, Most Merciful. 

All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.


In this fatwa:

The majority of contemporary scholars include oil in the concept of rikaz. If this oil is extracted by an individual or a company, one fifth becomes due as zakah.


Answering your question about zakah on oil, Dr. Muhammad Salama, PhD, Islamic Studies in English, Associate Professor at the Faculty of Islamic Sciences al-Madinah International University (Mediu), states: 

Suppport AboutIslam.net

The Messenger of Allah (peace and blessings be upon him) said, “One fifth is due [as Zakah] on rikaz (buried treasures.)” (Al-Bukhari and Muslim)

So, this one fifth is payable once the rikaz is extracted regardless of the mount discovered. For there is no nisab (minimum amount of wealth to be zakatable). Also, the elapse of a whole lunar year is not necessary as well.

Zakah on Oil

The majority of contemporary scholars include oil in the concept of rikaz. If this oil is extracted by an individual or a company, one fifth becomes due as zakah.

The same holds true if the oil is extracted by the state authority, according to a group of scholars who regard the state as a legal personality.

But, according to another group of scholars, the state authority cannot be subject to zakah. This is because the state has to utilize the zakah for public interests anyway. This latter opinion sounds more reasonable.

Almighty Allah knows best.