Tabung Haji: Advantages To Malaysia

What is tabung haji?
Tabung Haji or Lembaga Tabung Haji is the Malaysian hajj pilgrims fund board. It was formerly known as Lembaga Urusan dan Tabung Haji (LUTH). The main headquarters is located at Jalan Tun Razak, Kuala Lumpur. Tabung Haji facilitates savings for the pilgrimage to Mecca through investment in Shariah-compliant vehicles.

Benefit of the tabung haji?
Islamic shariah law.
Shariah prohibits acceptance of specific interest or fees for loans of money that is known as riba, or usury, whether the payment is fixed or floating. Investment in businesses that provide goods or services considered contrary to Islamic principles that is pork or alcohol is also haraam

Shariah principle in tabung haji investment
Al-Masyarakah
shareholder

Al-Qardhul hassan
In Islamic finance, an interest-free loan. In qardhul hasam, the borrower only repays the principal amount. Because the Quran forbids paying or receiving interest, qardhul hasam is the only permissible loan in Islamic finance. However, this does not preclude a number of other investment vehicles that imitate the payment of interest.

Al-Wadiah
Refers to a concluded contract between the owner (depositor) of the goods (the money) and the custodian (Bank) for safekeeping. The depositor grants the Bank their permission to utilize the money for whatever purpose permitted by SYARIAH.

Competitive dividend.
The bonus rate of six per cent of the Tabung Haji is competitive, three points higher than the rate of return on fixed deposit accounts conventional and Islamic banking.

Zakat paid.

As an Islamic institution, before distribution of dividend to its members, Tabung haji pays business tithe (zakat) from the profits earned during the year and the amount of working capital at the end of the zakat financial year. The prescribed rate of zakat is 2.5% on the aggregate of the above sum.

Tax

“During the Supreme Council meeting, I explained everything and they accepted it and gave constructive views to me,” he said. “And I urge for the people outside there not to be fooled by lies and political ploys. I have never involved politics in Tabung Haji. I am the chairman for all, not for certain segments of society.” Tabung Haji's purchase of the plot of land from 1MDB for RM188.5 million, or RM2,774 per sq ft, for the purpose of building a residential tower has created uproar among its depositors, some of whom withdrew their savings at its branch in Shah Alam on Thursday. Opposition politicians were quick to note that Tabung Haji was paying far more per square feet (psf) than what 1MDB had paid at RM64 psf when it first bought the land from the government, leading some to call the deal a "bailout" given 1MDB's massive debts. On Saturday, the fund announced it was selling the land it purchased from 1MDB, following public outcry over the transaction. – May 11,