section_path: Sources of income and arms/Internal revenue/Extortion and taxation
section_name: Extortion and taxation
paragraph_text: Extortion and taxation
  
  Also in the 2008–2011 period, al-Shabaab established a sophisticated taxation system, framed as a form of zakat, in line with sharia, but often resembling extortion. Al-Shabaab taxes may apply to clans, traders, corporations, farmers, or livestock herders – in fact, livestock are sometimes stolen outright by al-Shabaab militants, with the theft framed as a kind of pre-emptive in-kind taxation. Humanitarian aid agencies are also taxed or extorted, in exchange for permission to operate inside certain territories (); and al-Shabaab has been known to execute kidnappings for ransom. In recent years, facing territorial losses in urban areas, al-Shabaab has had less recourse to previous revenue streams – notably the charcoal trade, through Kismayo, and the remittance economy – and therefore has relied more heavily on extracting zakat. The development of its security and intelligence services has allowed it to expand its tax base by imposing taxes even in areas outside its territorial control: according to the Hiraal Institute, more than half of al-Shabaab's revenue in 2019–20 came from Mogadishu, whose major companies are taxed at 2.5% of their annual profits. Indeed, a commander in the Somali army confessed to paying tax to al-Shabaab despite being at war with it. The group has been known to punish non-payment severely, including by blockading villages under threat of starvation.