Abstract
Indonesia as a one of the most significant Muslim population in the world has developed zakat rapidly; it is shown by the development of the zakat regulation and establishes of Badan Amil Zakat Nasional (BAZNAS). Zakat has many benefit for economic both of macro and micro aspect, such as foster inclusive economic growth. The objective of this study are 1) to examine the influence of zakat on economic growth and welfare society which uses 3 (three) indicators i.e.HDI, Percentage of Poor People, and GINI Index and 2) to investigate whether items of Theory Planned Behavior influence of zakat payment. The researcher used Structural Equation Model (SEM) with PLS software. The result showed that zakat in Indonesia does not influence economic growth and welfare society. Besides that, welfare society Indonesia as a developing country has a negative value to HDI and GINI index but has a positive value to Percentage of Poor People.
Highlights
Poverty is a classic problem that has not been resolved in Indonesia until now
As we mentioned before Zakat is one of the proper indicators to measure economic growth, when people pay Zakat the level of economic growth will be higher and vice versa (Sarea, 2012), this study will explore the influence of zakat on economic growth and welfare society that measured by Human Development Index, Percentage of Poor People, and GINI Index
Inductive analysis using Partial Least Square (PLS) includes research goodness of fit model, which serves to determine the suitability of a model used in the study using variables Zakat, Economic Growth, and Welfare Society that measured by Human Development Index, Percentage of Poor People, and GINI index
Summary
Poverty is a classic problem that has not been resolved in Indonesia until now. One effort to reduce poverty in Indonesia was zakat. Zakat is a sum of money or goods taken from assets that have fulfilled the requirements of haul and nisab and allocate it to muzakki. Zakat is one of the pillars in the pillars of Islam as a form of social action that must be carried out by every Muslim. Zakat sanctifies the soul from stinginess, greed, and selfishness; purify property from the rights of others; and have a positive impact on the economy of the community by reducing poverty, increasing economic growth, and increasing purchasing power parity (Rahim & Fanani, 2014; Syahrullah & Ulfah, 2016). Zakat is a form of social and economic value worship that can reduce economic inequality in society. With proper management of zakat, it is expected that evenly distributed income can be realized
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