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Last Updated: Jun 25th, 2007 - 17:07:26 |
The government today said it will introduce new measures to make Muslim financial packages easier in the UK.
Islamic, or Sharia, law forbids the charging or receiving of interest (riba in Arabic), making conventional mortgages, overdrafts, and many investment funds off limits. While shares and dividends are acceptable, speculation is forbidden.
Additionally the only companies that are halal (permissible) to own shares in cannot have income from alcohol, pork-related products, pornography and nudity, conventional financial services, gambling, tobacco, armaments and human or animal genetic experimentation.
Currently there are several providers of Islamic current accounts, mortgages, and child trust funds - with plans announced to move into insurance and pension products.
And today Treasury minister Ed Balls set out new measures to help people launching Islamic finance products in the UK.
The government said the finance bill 2007 would include measures to help the UK issuance and trading of Islamic securitisation products (sukuk), and added guidance on Islamic loan repayment systems (diminishing musharka) and insurance (takaful) would be published alongside the Budget.
"Today I am able to set out the next stage in our reforms to ensure the tax and regulatory system will encourage the development of Sharia compliant products," Mr Balls said.
"Today is an example of public and private sectors working together to fulfil our shared ambition of creating major international markets in Islamic finance with London as their centre."
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