Zakat, Poverty in Indonesia and the Impact of Welfare on Society

Abstract

Indonesia's poverty rate in early 2025 was reported at around 8.47%, or approximately 23.65 million people, according to Statistics Indonesia (BPS). However, this figure is still quite high and differs from World Bank data, which classifies a larger proportion of Indonesia's population as poor, namely around 68.25%, or 194.58 million people, in 2024 using a different poverty line. This poverty problem is triggered by several factors such as difficulty finding work, low income, job losses, and income disparities between regions, especially in areas such as Highlands Papua, which has the highest poverty rate.The persistently high poverty rate in Indonesia indicates that the potential of zakat as an Islamic social finance instrument has not been optimally utilized. Although Indonesia has the potential to collect hundreds of trillions of rupiah in zakat annually, its collection remains very low. This problem indicates the existence of structural, regulatory, and institutional barriers in the national zakat management system. This study aims to identify and critically analyze the problems in the regulations and institutions for the collection of zakat, infaq, and alms (ZIS) by Zakat Management Organizations (OPZ), such as BAZNAS and LAZ. The research method used is a qualitative approach with a documentary study of laws and regulations, institutional reports, and academic literature. The results of the study indicate that existing regulations, particularly Law No. 23 of 2011, are still partial, lack clear sanction mechanisms, and create overlapping authority between zakat institutions. The implications of this research indicate the need for more integrative, adaptive, and visionary zakat regulatory updates to increase the effectiveness of ZIS collection, while simultaneously making zakat a strategic instrument in poverty alleviation and supporting the sustainable development agenda.