The Imperative of Zakat on Financial Instruments in a Globalized Economy
DOI:
https://doi.org/10.47134/wiep.v2i3.648Keywords:
Zakatable Financial Instruments, Islamic Wealth Redistribution, Global Zakat Governance, Shariah-Compliant Capital Markets, Ethical Fintech InnovationAbstract
Amidst a $109 trillion global equity market and widening wealth chasms, this study repositions Zakat—Islam’s divine wealth tax—as a radical antidote to neoliberal excess. Synthesizing juristic rigor with empirical analysis, it asserts stocks and asset-backed sukuk as Zakatable under Urud al-Tijarah, contingent on trade intent and Shariah compliance. Indonesia’s BAZNAS emerges as paradigmatic, diverting 12% of $700M annual Zakat from equities to uplift 15,000 families, while Malaysia’s automated systems and Saudi profit-levies reveal scalable blueprints. Yet $1 trillion in uncollected Zakat persists, shackled by bond-based riba, regulatory disarray, and valuation ambiguities. The work champions blockchain traceability, AI-driven compliance, and harmonized global frameworks to unlock Zakat’s latent power. By fusing prophetic ethics with fintech innovation, this research reengineers capitalism’s DNA—transforming speculative markets into conduits of sacred equity, where prosperity is not hoarded but flowed, as Imam Al-Ghazali envisioned, to every corner of our parched world.
References
Abdullah, S., Ab Rahman, A., & Abdullah, L. H. (2023). Exploring Zakatable Wealth from Classical and Contemporary Scholars Perspectives. UMRAN-Journal of Islamic and Civilizational Studies, 10(2), 53-70. DOI: https://doi.org/10.11113/umran2023.10n2.614
Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). (2017). Shari’ah standards. Retrieved from https://aaoifi.com/shariaa-standards/?lang=en
Ahmad, W., & Marhaini, W. (2012). Zakat investment in Malaysia: a Study of Contemporary Policy and Practice in Relation to Shari'a.
Ahmed, H. M. (2025, February 19). Why has Islamic finance not been able to reduce poverty in Muslim countries? The Halal Times. Retrieved April 5, 2025, from https://www.halaltimes.com/why-has-islamic-finance-not-been-able-to-reduce-poverty-in-muslim-countries/
Al-Bukhayyet, S. K. (1998). A study of the choice of inventory accounting methods in Saudi Arabia. The George Washington University.
Almenfi, M., Gentilini, U., Blomquist, J., Dale, P., De la Flor Giuffra, L., Desai, V., Fontenez, M. B., Galicia, G., Lopez, V., Marin, G., Mujica, I. V., Natarajan, H., Newhouse, D., Palacios, R., Quiroz, A. P., Rodriguez Alas, C., Sabharwal, G., & Weber, M. (2021). Social protection and jobs responses to COVID-19: A real-time review of country measures. World Bank. https://documents1.worldbank.org/curated/en/110221643895832724/txt/Social-Protection-and-Jobs-Responses-to-COVID-19-A-Real-Time-Review-of-Country-Measures.txt DOI: https://doi.org/10.1596/33635
Al-Qaradawi, Y. (1999). Fiqh al-Zakah: A Comparative Study—The Rules, Regulations and Philosophy of Zakah in the Light of the Qur'an and Sunna. Dar Al Taqwa Ltd. Retrieved from https://www.scribd.com/document/100694427/Qaradawi-Y-1999-Fiqh-Al-Zakah
Andriyanto, I., & Islamiah, M. H. (2025, January). Optimizing Zakat Management Through Integration of Zakat Core Principles, Digital Transformation, and Internal Control: A Case Study of BAZNAS. In International Conference on Research Issues and Community Service (Vol. 1, No. 1, pp. 275-280).
Arab News. (2025, March 30). SR1.8 billion donated to Jood Regions housing campaign during Ramadan. Retrieved April 5, 2025, from https://www.arabnews.com/node/2595353/saudi-arabia
Auliyah, R., & Basuki, B. (2021). Ethical values reflected on Zakat and CSR: Indonesian sharia banking financial performance. The Journal of Asian Finance, Economics and Business, 8(1), 225-235.
Chong, F. H. L. (2021). Enhancing trust through digital Islamic finance and blockchain technology. Qualitative Research in Financial Markets, 13(3), 328-341. DOI: https://doi.org/10.1108/QRFM-05-2020-0076
Dakhoir, A. (2019). Al-Qardawi's Thought on Zakat of Stocks in a Modern Industry: an Experience of Indonesia. Al-Manahij: Jurnal Kajian Hukum Islam, 13(2), 159-168. DOI: https://doi.org/10.24090/mnh.v13i2.2023
Damak, M., Anand, N., Jagtiani, S., & Mujkic, E. (2024, April 29). Islamic finance 2024-2025: Resilient growth anticipated despite missed opportunities. S&P Global Ratings. Retrieved from https://www.spglobal.com/ratings/en/research/articles/240429-islamic-finance-2024-2025-resilient-growth-anticipated-despite-missed-opportunities-13074068
Dar al-Ifta. (2013, August 22). Zakat on stocks and shares. Dar al-Ifta. Retrieved from https://www.dar-alifta.org/en/fatwa/details/6437/zakat-on-stocks-and-shares
DinarStandard & Elipses. (2022). Global Islamic Fintech Report. Qatar Financial Centre. Retrieved from https://www.qfc.qa/-/media/project/qfc/qfcwebsite/documentfiles/research/global-islamic-fintech-report.pdf
Domat, C. (2024, August 1). Islamic finance: Just for Muslim-majority nations? Global Finance. https://gfmag.com/banking/islamic-finance-just-muslim-majority-nations/
Enterprise News. (2025, April 5). New zakat regulations go into effect next week: Here’s what you need to know. Enterprise News. Retrieved from https://enterprise.news/ksa/en/news/story/627d9a1c-8f61-46b1-8866-55b960aed701/new-zakat-regulations-go-into-effect-next-week-%25e2%2580%2594-here%25e2%2580%2599s-what-you-need-to-know
Galan, S. (2025, January 23). Share of global population affiliated with major religious groups 2022. Statista. Retrieved April 5, 2025, from https://www.statista.com/statistics/374704/share-of-global-population-by-religion/
Gallien, M., Javed, U., & van den Boogaard, V. (2024). Zakat, non-state welfare provision and redistribution in times of crisis: evidence from the Covid-19 pandemic. Studies in Comparative International Development, 1-27. DOI: https://doi.org/10.1007/s12116-024-09447-x
Hadzami, M. S. I. (2023). Comparative Analysis of Yusuf Al-Qardhawi's And Wahbah Az-Zuhaili's Ideas on The Law of Zakat Stock (Bachelor's thesis, Fakultas Syariah dan Hukum UIN Syarif Hidayatullah Jakarta).
Harun, N. B., Ilyas, I. Y., Badarudin, I. B. M., Royali, S. B. A., Tamrin, M. B., Ahmad, N. H. B., & Munahar, M. M. (2024). The Zakat Officer Opinion Toward Business Innovation Model with Internal, External Successful Factor, Shariah Compliance, Digital Technology and Agency Authorities Among Asnafpreneur in Malaysia. Global Business and Management Research, 16(2s), 1067-1080. DOI: https://doi.org/10.22610/imbr.v16i1(I).3678
Islamic Finance News. (2020, November 9). IsDB and BAZNAS to pilot Zakat project in Indonesia to support national development programs. Islamic Finance News. Retrieved from https://www.islamicfinancenews.com/daily-cover-story-isdb-and-baznas-to-pilot-zakat-project-in-indonesia-to-support-national-development-programs.html
IslamQA. (n.d.). He bought Islamic sukuk; does he have to pay zakaah on the profits or on both the profits and the principal? Retrieved from https://islamqa.info/en/answers/131229/he-bought-islamic-sukuk-does-he-have-to-pay-zakaah-on-the-profits-or-on-both-the-profits-and-the-principal
Juniati, W., & Widiastuti, T. (2024). Intention to adopt blockchain technology for zakat management in Indonesia. Journal of Islamic Marketing. DOI: https://doi.org/10.1108/JIMA-12-2023-0384
Kidwai, A. (2021, December 29). Potential global zakat pool: Demystifying the numbers. NZF Worldwide. Retrieved April 5, 2025, from https://nzfworldwide.com/potential-global-zakat-pool-demystifying-the-numbers/
Kunhibava, S., Muneeza, A., Khalid, M. B., Mustapha, Z., & Sen, T. M. (2024). Social Sukuk. In Islamic Social Finance: Law and Practice in Malaysia (pp. 105-128). Singapore: Springer Nature Singapore. DOI: https://doi.org/10.1007/978-981-97-1410-0_6
Kuran, T. (2020). Zakat: Islam’s missed opportunity to limit predatory taxation. Public Choice, 182(3), 395-416. DOI: https://doi.org/10.1007/s11127-019-00663-x
Mahkamah Agung Republik Indonesia. (2001). Peraturan & Perundang-Undangan. Retrieved from https://putusan3.mahkamahagung.go.id/peraturan/detail/11eae9c8e033f6f0a8fb313432353535.html
Mahmud, M. W., & Haneef, S. S. S. (2008). Debatable issues in Fiqh Al-Zakat: A jurisprudential appraisal. Jurnal Fiqh, 5, 117-141. DOI: https://doi.org/10.22452/fiqh.vol5no1.6
Malay Mail. (2023, November 1). Steven Sim urges Malaysia’s financial sector to continue facilitating green financing. Malay Mail. Retrieved from https://www.malaymail.com/news/malaysia/2023/11/01/steven-sim-urges-malaysias-financial-sector-to-continue-facilitating-green-financing/99613
Maulida, A. Z., & Purnomo, A. (2023). Islamic Public Finance: Productive Zakat and Taxes As Instruments of The Country's Economy. Journal of Contemporary Applied Islamic Philanthropy, 1(2), 75-86. DOI: https://doi.org/10.62265/jcaip.v1i2.45
Mohamed, S. (2024, June 12). Islamic finance: Global industry on track towards projected growth. LSEG. Retrieved April 5, 2025, from https://www.lseg.com/en/insights/data-analytics/islamic-finance-global-industry-on-track-towards-projected-growth
Mokodenseho, S., Syafri, M., Hasrullah, H., & Judijanto, L. (2023). Utilizing Blockchain Technology to Increase Transparency in Zakat Management. West Science Islamic Studies, 1(01), 01-09. DOI: https://doi.org/10.58812/wsiss.v1i01.280
Moody's Investors Service. (2023). Islamic Finance Outlook 2023. Moody's Investors Service. Retrieved from https://ma.moodys.com/rs/961-KCJ-308/images/Islamic%20Finance%20Outlook%202023-pdf.pdf
Naser, A., Bany-Ariffin, A. N., & Matemilola, B. T. (2024). Cash flow volatility and capital structure in MENA and Africa: the moderating role of fixed assets. Cogent Economics & Finance, 12(1), 2373255. DOI: https://doi.org/10.1080/23322039.2024.2373255
Neufeld, D. (2023, September 27). The $109 trillion global stock market in one chart. Visual Capitalist. Retrieved April 5, 2025, from https://www.visualcapitalist.com/the-109-trillion-global-stock-market-in-one-chart/
New Straits Times. (2021, April 22). Malaysia's first sukuk in five years overwhelmed, asserts status as world's biggest market. New Straits Times. Retrieved from https://www.nst.com.my/business/2021/04/684652/malaysias-first-sukuk-five-years-overwhelmed-asserts-status-worlds-biggest
Ningrat, G. (2018, November 24). Islamic finance and blockchain: Can it bring greater impact? The Jakarta Post. Retrieved from http://www.thejakartapost.com/academia/2018/11/24/islamic-finance-and-blockchain-can-it-bring-greater-impact.html
Noor, A. B. M., Kaba, A. R., Shaarani, A. Z. B. M., & Saleh, A. O. H. (2021). The Concept of Zakat of Mustaghallat and Its Application to Long Term Investment Sukuk. In The Importance of New Technologies and Entrepreneurship in Business Development: In The Context of Economic Diversity in Developing Countries: The Impact of New Technologies and Entrepreneurship on Business Development (pp. 1605-1614). Springer International Publishing. DOI: https://doi.org/10.1007/978-3-030-69221-6_118
OECD. (2020). How Islamic finance contributes to achieving the sustainable development goals. OECD. Retrieved from https://www.oecd.org/content/dam/oecd/en/publications/reports/2020/06/how-islamic-finance-contributes-to-achieving-the-sustainable-development-goals_ba8b0e21/ac1480ca-en.pdf
Othman, A., & Adnan, A. A. (2014). Revisiting dividends, capital asset purchase and donations in business zakat assessment: The Malaysia experience. International Journal of Business and Social Science, 5(12), 190-196.
Otoritas Jasa Keuangan. (2001, April 18). Fatwa Nomor: 20/DSN-MUI/IV/2001. Retrieved from https://ojk.go.id/id/kanal/syariah/regulasi/fatwa-dsn-mui/Pages/fatwa-nomor-20-dsn-mui-iv-2001.aspx
Powell, R. (2009). Zakat: Drawing insights for legal theory and economic policy from Islamic jurisprudence. Pitt. Tax Rev., 7, 43.
Puskas BAZNAS. (2021, June 22). The public expose of the World Zakat Performance Index. Retrieved April 5, 2025, from https://puskasbaznas.com/news/1525-the-public-expose-of-the-world-zakat-performance-index
Puskas BAZNAS. (2023). Outlook Zakat Indonesia 2023. Retrieved April 5, 2025, from https://puskasbaznas.com/publications/books/1737-outlook-zakat-indonesia-2023
PwC. (2025, March 19). Saudi Arabia - Corporate - Taxes on corporate income. PwC Tax Summaries. Retrieved from https://taxsummaries.pwc.com/saudi-arabia/corporate/taxes-on-corporate-income
Rahman, S. (2014). Ethical investment in the stock market: Halal investing and zakat on stocks. Available at SSRN 2504832. DOI: https://doi.org/10.2139/ssrn.2504832
Rahman, S. (2015). Ethical investment in stock screening and zakat on stocks. Journal of Islamic Finance, 4(1), 39-62. DOI: https://doi.org/10.12816/0024800
Razak, S. H. A. (2020). Zakat and waqf as instrument of Islamic wealth in poverty alleviation and redistribution: Case of Malaysia. International Journal of Sociology and Social Policy, 40(3/4), 249-266. DOI: https://doi.org/10.1108/IJSSP-11-2018-0208
Reuters. (2022, July 27). Islamic finance demand rising but depth lacking. Reuters. Retrieved from https://www.reuters.com/article/business/finance/islamic-finance-demand-rising-but-depth-lacking-idUSL27213946/
Ritholtz, B. (2023, October 4). $109 trillion global stock market. The Big Picture. Retrieved April 5, 2025, from https://ritholtz.com/2023/10/109-trillion-global-stock-market/
Rosele, M. I., Abdullah, L., & Ramli, M. A. (2013). Al-Qaradawi’s Juristic Perspectives On Zakah of Agricultural Wealth as Reflected in His Fiqh Al Zakah. Journal of Emerging Economies and Islamic Research, 1(3), 49-60. DOI: https://doi.org/10.24191/jeeir.v1i3.9129
Sawmar, A. A., & Mohammed, M. O. (2021). Enhancing zakat compliance through good governance: a conceptual framework. ISRA International Journal of Islamic Finance, 13(1), 136-154. DOI: https://doi.org/10.1108/IJIF-10-2018-0116
Sifat, I. M., & Mohamad, A. (2018). Revisiting fiat regime’s attainability of shari’ah objectives and possible futuristic alternatives. Journal of Muslim Minority Affairs, 38(1), 1-23. DOI: https://doi.org/10.1080/13602004.2018.1435057
Thaler, R. H. (1999). Mental accounting matters. Journal of Behavioral decision making, 12(3), 183-206. DOI: https://doi.org/10.1002/(SICI)1099-0771(199909)12:3<183::AID-BDM318>3.0.CO;2-F
Tolefat, A. K., & Asutay, M. (2013). Takaful investment portfolios: A study of the composition of Takaful funds in the GCC and Malaysia. John Wiley & Sons. DOI: https://doi.org/10.1002/9781119199007
UBS. (2023, August 15). Global wealth report 2023. Retrieved April 5, 2025, from https://www.ubs.com/content/news/en/2023/08/15/global-wealth-report-2023/_jcr_content/mainpar/toplevelgrid/col2/linklistnewlook/actionbutton.0442435677.file/PS9jb250ZW50L2RhbS9hc3NldHMvbmV3cy8yMDIzLzA4LzE1LzIwMjMwODE1LW1yLWdsb2JhbHdlYWx0aHJlcG9ydC1lbi5wZGY=/20230815-mr-globalwealthreport-en.pdf
UPZ BAZNAS Telkom. (2022). Program ekonomi. Retrieved April 5, 2025, from https://telkomupz.org/page/program-ekonomi
World Bank. (2025). Accelerating economic transformation: 2021-2025. Retrieved April 5, 2025, from https://openknowledge.worldbank.org/server/api/core/bitstreams/8500b684-aaac-5e78-8df1-6942c4baa572/content
World Population Review. (2025). Muslim population by country 2025. Retrieved April 5, 2025, from https://worldpopulationreview.com/country-rankings/muslim-population-by-country
Zakat, Tax and Customs Authority. (n.d.). Zakat regulations. Zakat, Tax and Customs Authority. Retrieved from https://zatca.gov.sa/en/RulesRegulations/Taxes/Pages/ZakatRegulations.aspx
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Kurniawan Arif Maspul, Islahuddin Ramadhan Mubarak
This work is licensed under a Creative Commons Attribution 4.0 International License.
