LAHORE - All commercial banks and financial institutions of the country will remain closed for public dealings on Thursday, the first of Ramazan 1434 AH, with a view to deduct zakat from the deposits of their account holders.
The State Bank of Pakistan has fixed Rs41,872 Nisab this year for deduction of zakat from savings accounts. According to details, zakat will be deducted from those savings accounts which have sum above the fixed Nisab of Rs41,872. This year’s Nisab is around 18 percent less than Rs51,086 fixed last year. Reduction is primarily attributed to recent decline in gold prices.
Banks officials said that customers have already started to withdraw money from banks and are finding means of avoiding deductions. As per rules of the central banks, majority of the account holders have submitted an affidavit to the banks, asking the management not to deduct zakat. Any person who has deposited money on a day before the first Ramazan would also face deduction. The officials said that financial institutions have collected around Rs4.5b in the head of zakat during last fiscal, which is used by the Bait-ul-Maal for different development projects in the country. 
According to Islamic Shariah, all Muslims are required to pay 2.5 percent Zakat on their annual savings. Under zakat ordinance, banks deduct 2.5 per cent zakat from all the savings accounts on Ist of Ramazan According to bank rules, any person having foreign currency account or current account is exempted from the deduction. The banking industry sources said that a large number of people adopt different procedures for avoiding zakat.  For instance, some customers opt for pay order and some go for cash deposit report, in both cases they save themselves from paying zakat, said a banker adding some customers transfer their money to current accounts.
Experts are of the view that there are many flaws and discrepancies in the deduction of zakat through banks, which makes it doubtful in the eyes of a large number of people. The zakat and ushr system was introduced through zakat and ushr Ordinance in 1980 as a part of the overall so-called policy of the then President of Pakistan Zia-ul-Haq for Islamizing the society.
They said that Central Zakat Administration was established to implement zakat system in Pakistan. However, experts are of the view that that many basic principles were ignored in deducting Zakat from the account holders. They said that banks deduct zakat irrespective of the date of deposit of the amount. Any person who deposits money a day before will be liable to pay Zakat. According to rules if an accountholder wants exemption from Zakat deduction he should give a certificate.