Zakat and Ushr Ordinance, 1980

The Zakat and Ushr Ordinance, 1980 sets up Pakistan's official system for assessing, collecting, and distributing Zakat (a religious levy on wealth) and Ushr (a levy on agricultural produce), as part of implementing Islamic principles in the state's financial system. It applies to Muslim citizens of Pakistan and to companies or associations majority-owned by such citizens (Section 1).

Section 3 provides for the charge and collection of Zakat, typically deducted at source by banks, post offices, and similar institutions listed as "Deducting Agencies" in the First Schedule, on dates specified there. A person who follows a fiqh (school of Islamic jurisprudence) that does not require paying Zakat in this compulsory manner can file a sworn declaration to that effect (Section 1(3) and its provisos) to be exempted from compulsory deduction, or to claim a refund if it was collected anyway; the Federal Shariat Court can rule on whether such a declaration is valid (Section 1(3A)). Sections 5-6 cover Ushr, charged on agricultural produce, assessed and collected through Local Zakat and Ushr Committees.

Sections 7-11 establish Zakat Funds at various levels, how they may be utilized and disbursed (aimed at assisting the needy, indigent, and poor, per the Ordinance's preamble), and require proper accounts and audit of these funds. Sections 12-23 set out the administrative machinery: a Central Zakat Council, an Administrator-General, Provincial Zakat Councils, a Chief Administrator, and a cascading structure of District, Tehsil/Taluqa, and Local Zakat and Ushr Committees, with Section 19A requiring council and committee members to be Muslims.

The extract's schedules show some of the specific religious rates applied: Zakat is generally charged at 2.5% of the market value of qualifying assets as on the Valuation Date; Ushr on agricultural produce is charged at rates such as 10% of produce in non-irrigated ("barani") land and 5% in irrigated land for a tenant's share, with different rules for the owner's share; and Zakat on livestock (sheep, goats, cattle, camels) follows tiered thresholds based on herd size, as detailed in the Schedule.

This is a religiously grounded, administratively detailed law dating to 1980 with several amendments (including a 1983 amendment and provisions inserted by later Finance Acts). Given the complexity of the exemption and rate provisions and the several amendment footnotes shown in the extract, anyone needing to confirm current rates, exemption procedures, or specific committee structures should verify against the up-to-date official text.