Where the money goes, and what replaces it.

Where the money goes

Start with Pakistan. The federal interest bill for FY2023-24 was Rs 8.16 trillion, larger than all the revenue the federation kept after the provinces' share: about 115 percent of it. Pakistan sits at the severe end of a distribution that runs through rich and poor states alike: in the United States, net interest reached about 18 percent of federal revenue in FY2024, more than the entire defence budget. The other figures are in the argument.

That increase is riba, for any increase stipulated on a loan or a debt is riba. The Qur'an tells the believers to "give up what remains of riba", and warns those who persist of "a war from Allah and His Messenger" (Q 2:278-279). The modern order has made that contract its foundation: most of its money is created as a loan at interest.

Its standing taxes characteristically fail the law of lawful taking. The Qur'an forbids consuming one another's wealth unjustly (Q 4:29), and the jurists require that wealth be taken by right, given in right, and withheld from falsehood. Those taxes state no maximum, and no forum returns what they over-take. Inflation is a levy no legislature votes on: a dollar held as cash since the gold window closed in August 1971 buys what 12.2 cents bought, while a saver who rolled Treasury bills came out about 36 percent ahead in real terms, before tax. It falls on those who hold their money without interest.

What replaces it, and what it costs

The Islamic order is the answer: a state funded on land and resource rents held in trust for everyone, on reciprocal trade levies and on fees priced to the service. Zakat goes to the eight categories of Q 9:60 and cannot fund the general operations of the state. An emergency levy is allowed only on an empty treasury, and only while the need lasts. No standing tax is laid on wages.

We costed it and published the shortfall first. Set aside the interest bill, void while the principal actually advanced is still owed (Q 2:279), and a lean state needs about 10.6 percent of GDP. On what a state of Pakistan's type collects today on the bases the design keeps, the design falls 7.75 to 8.05 points of GDP short. The distance is large, it is measured, and a measured distance is something to build across. The design is built to survive a land line of 1.5 percent of GDP, and at that line it is still 1.7 points short, which it states. The Gulf states, drawing on resource rents, show that a large government can be funded with no personal income tax in force; the design itself is built for the resource-poor state that cannot use their answer. The gap is closed by building the machinery that collects land and resource rents and reciprocal customs, never by taxing wages.

How the passage is made

The third book shows how the passage is made. The building of the replacement may be staged by capacity. The ceasing of riba may not be staged at all, because the staging of the law itself closed when revelation was completed (Q 5:3). The interest is void at once, whoever holds the claim, and the principal actually advanced is still owed: "you shall have your principal: you do not wrong and are not wronged" (Q 2:279). At the Farewell Pilgrimage the Prophet ﷺ struck down the riba of the age of ignorance, beginning with that owed to his own uncle, al-'Abbas ibn 'Abd al-Muttalib (R.A.): "for it is struck down, all of it" (Sahih Muslim 1218). No price the passage costs is a reason to keep the riba.

And Islamic banking?

And Islamic banking? Its scholars set out in the right direction, and their work is a milestone, still far from the destination. But a compliant product inside an uncompliant order is not the order, not a stage of it, and not evidence that the order has been tried. The verdict falls on the frame, never on the people, and the validity of a given contract is for the muftis.