Opening interest-based account : is a money market account Riba based ? can we use earned interest to pay for taxes ?

Fatawa Question

I deal with a credit union bank. This bank has loans activities as well as investments activities e. g. Money Market Investment. At the end of the fiscal year, I receive the financial statement that shows the percent of each activity. I always isolate the percent of loan activities that the bank issues (the percent of the loan earning to the total bank earnings) and consider this the Riba part of the interest. I also use this part to pay the Tax in the USA. How allowable is this act ?. Thanks. To clarify on the Money Market, the money can be loaned to big corporations. Is this still considered Riba even if all in all are calculated and risk weighted. Is not it an investing process not really a loan process ?

Fatwa

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Publication Date

2002-12-25

Main Subjects

Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Investments
• Financial markets
• Taxes
• Usury
• Subprime mortgage

No. of Pages

3

Data Type

Fatawa

Language

English

Record ID

BIM-725816

• APA
• MLA
• AMA