Budget 2009 sukuk: Real estate from an Islamic perspective

The sukuk market was booming in 2007 but has since come to a standstill.

This was, in part, due to an adverse ruling by a prominent sharia'a scholar in respect of the use of purchase undertakings. But the UK tax system was also a factor: it imposed tax on various stages of the issue of sukuk in a way that it did not do with more "traditional" bond structures.

Interested parties (including Wragge & Co) have been lobbying the UK Government to change the tax rules for some time, in order to bring about a level playing field.

Read Wragge & Co's analysis for a more in-depth consideration of the issues.