Is it permissible for the ruler (Imam) to set prices (price control or *tas'eer*)?
Chapter on Selling the Musarrah (Animal with milk retained in udder)
Al-Mughni
Book of Sales
Primary text
The ruler is prohibited from setting prices for the people. The ruling held by Ibn Hamid and the school of Shafi'i is that the ruler must allow people to trade their goods at prices they mutually agree upon. The evidence for prohibiting price setting is the Hadith narrated from Anas where the people requested the Prophet, peace be upon him, to set prices because they had become high. The Prophet responded, "Verily, Allah is the Setter of prices, the Withholder, the Outstretcher, the Provider. I hope to meet Allah such that no one seeks redress against me concerning oppression, neither in blood nor in wealth." (Hadith graded Hasan Sahih by Tirmidhi). This is evidenced by two points: first, the Prophet did not set prices despite the request, and second, he predicated the refusal on price setting being a form of oppression, which is unlawful. Furthermore, since it is the seller's property, preventing them from selling it based on a mutual agreement reached by both contracting parties is impermissible.
Supporting text
Malik used to command those who intended to sell below the general market price to adhere to the prevailing market rate, otherwise they should leave the city. This was supported by the narration of Umar regarding a seller of raisins; Umar instructed him to either raise his price or remove his goods, citing that the current price set would be followed by incoming caravans from Ta'if, leading to harm for the sellers if prices rose or fell. However, it is reported that Umar later retracted this statement upon self-reproach, stating it was not a binding decree but an attempt to promote the public good.