I'm also Muslim so I guess I can answer this.
We usually pay it to charities, in the old days Muslims would go around looking for people who needed the money and directly pay it to them but now we send it off to foundations though we can still pay it directly if we would like.
Most Muslims also sponsor Orphans. I am actually sponsoring two orphans.
This is how bad things have become. I just thought that maybe I, a non-Muslim, could contribute to one of these charities. And then I immediately was worried that the transactions would be noticed and I would be accused of supporting a terrorist organization, because of the meta data between me and the charity and then innocent and coincidental meta data beween some third party person of interest and the same charity.
And thus is the First Amendment right to freedom of association destroyed. Fuck you, NSA.
Islamic scholar defined that any alms can be directly paid to the needy (which also been clearly defined). But in my country ruling, all the benefit of alms donation (tax exemption, etc) is applicable only when the alms is donated to specific government agency.
IMagine the huge sum of money which is different pool than tax money.
Large pool of money will attract attention and political pressure from dishonest individual in power.
And, when the agency is only focusing its effort in collecting the alms instead of distributing it to the needy, then the pool will only get bigger, and be the source of tension within society rather than 'peace of mind' force.
so far there is no 'huge' scandal erupt yet. The key terms here is 'yet'.
I meant that if only a small subset of society are honest, then only that dmall subset will do alms, thus the impact of alms to the needy will be somewhat small and ineffective.
And if there is large subset of society not honest and try to pose as the needy to receive the alms, then the system is screwed.
Oh I understand what you mean. Well obviously for his system to work the would need to be authorities that could find people that truly premise as impoverished.
ps: i am muslim and i pay alms every year. But sadden by the poor distribution of help to the needy.