Zakat Management and Welfare Distribution: Evidence from 34 Provinces in Indonesia

Abstract

Indonesia has the most Muslim population in the world and is among the most generous countries. One of the instruments of philanthropy, especially those that are mandatory against Muslims, is Zakat. Proper zakat management can alleviate poverty and address inequalities in society. Especially if Zakat can be used to economically empower the poor, increasing their capacity and allowing them to meet their own needs. This study tried to observe the zakat management and welfare distribution by looking at the National Zakat Index (IZN) score and also analyzed its implications in improving mustahiq welfare represented by the BAZNAS Welfare Index (IKB). The results of this study will show the quadrant position of the IZN and IKB achievement levels of 34 provinces in Indonesia in 2020 and 2021. Four quadrants are formed to answer whether zakat management and its impact on welfare have been evenly distributed throughout the 34 provinces in Indonesia.