Nizam Al-Mulk's thoughts on Islamic economics cover a wide range of aspects that are relevant today. From the concept of fair taxation, which emphasizes the importance of honesty and fairness in tax collection and management, to the role of hisbah in the market, which aims to ensure transparency and honesty in economic activity. In addition, Nizham Al-Mulk also highlighted the importance of savings for families as one of the pillars of household economic security.
In his Siyâr al-Mulk, he advised the tax collectors. According to him, there are several things that need to be considered regarding tax enforcement. First, tax collectors should treat people with respect and courtesy when collecting taxes. Secondly, taxes should be taken according to the proper amount of income, without exceeding or demanding unfairly. Third, taxes should only be demanded at the appointed time for payment, not before. The proceeds of tax collection must be used to meet the needs of the community and provide benefits for the public good. The importance of supervision of tax collection both by the leader (caliph) and by the people reporting on the behavior of tax officials every two or three years tax collectors and assignees must be changed so that they do not become too established and entrenched, and begin to cause anxiety.
According to Nizam Al-Mulk's view, market supervision is important to ensure that economic activities in the market are running properly and in accordance with the rules of Shariah. Each region should have a Muhtasib (person in charge of carrying out hisbah) to check the scales and prices, and ensure that business is conducted in an orderly and honest manner. The Muhtasib must ensure that the goods brought from each region are safe from dishonesty or fraud. The Muhtasib must also ensure that weights are properly maintained and moral and religious principles are observed.
The institution of hisbah was considered the main cornerstone of the state in achieving economic justice in society. According to Nizam al-Mulk, the duty of hisbah should be reinforced by the king and other officials. Institutions of market supervision should also be in place as, according to Nizam al-Mulk, they were an important foundation of the state structure. In today's economic context, the scope of the role of the institution of hisbah is very broad. In Indonesia, the institutions that perform the function of hisbah include the Financial Services Authority (OJK), Bank Indonesia, the Food and Drug Administration (BPOM), the Food, Drug and Cosmetics Assessment Institute of the Indonesian Ulema Council (LPPOM MUI).
Nizâm al-Mulk also explained the importance of savings for a family. Savings are the remaining income that is not consumed at this time but used for future purposes. Nizâm al-Mulk explained that saving is very important for anyone even a king did it. Ibn Sina placed savings in the third place in the division of consumption after the obligatory consumption and religion.
Nizam al-Mulk or with the full name Abu Ali al-Husain bin Ali bin Ishaq bin al-Abbas at-Thusi was a vizier or prime minister of the Seljuk Sultanate and a scholar of Persian descent. His most famous work is Siyasatnama (Siyâr al-Mulk) or “The Book of Politics.” In the book, Nizam al-Mulk gave advice to administrators by analyzing the administrative, financial, political, military, social and cultural dimensions of Turkish Islamic states.
Translated with DeepL.com (free version)
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