Aura Permata Putri, Sri Herianingrum

The Effects of Zakat, Infaq, Sadaqah, Social Aid, and Gross Regional Domestic Product per Capita on Income Inequality in Indonesia

Introduction

The effects of zakat, infaq, sadaqah, social aid, and gross regional domestic product per capita on income inequality in indonesia. Analyzes effects of Zakat, Infaq, Sadaqah (ZIS), social aid, and GRDP per capita on income inequality in 34 Indonesian provinces (2019-2023). Finds social aid & GRDP significantly reduce inequality.

Abstract

This study aimed to analyze the effect of ZIS (Zakat, Infaq, Alms), Social Assistance, and Gross Regional Domestic Product (GRDP) per capita on Income Inequality in 34 Provinces in Indonesia for the period of 2019-2023 partially and simultaneously. This research applied quantitative methods with multiple linear regression techniques. The data used in this study were secondary data on ZIS distribution from BAZNAS (National Amil Zakat Agency), realization of Social Assistance from KEMENKEU (Ministry of Finance), and Gross Regional Domestic Product (GRDP) per capita from BPS (Central Bureau of Statistics) in Indonesia for the 2019-2023 period. The results of the study showed that the distribution of ZIS funds (X1) has a negative and insignificant effect on the income inequality level. Social assistance realization has a negative and significant effect on income inequality. Gross Regional Domestic Product has a negative and significant effect on income inequality. ZIS, Social Assistance, and Gross Regional Domestic Product significantly affect income inequality in Indonesia from 2019 to 2023. This study suggested that zakat management institutions or agencies optimize ZIS funds to empower the mustahik economy and the entire community to increase literacy and awareness so that the collection and distribution of ZIS funds becomes optimal as a solution to the level of income inequality.

Review

This study tackles a highly relevant and timely subject, examining the multifaceted drivers of income inequality in Indonesia. The inclusion of Zakat, Infaq, Sadaqah (ZIS) alongside conventional social assistance and Gross Regional Domestic Product (GRDP) per capita provides a particularly valuable and context-specific lens, especially given Indonesia's demographic and religious landscape. The research design, employing quantitative methods with multiple linear regression on robust secondary data from credible national agencies (BAZNAS, KEMENKEU, BPS) across all 34 provinces for a recent five-year period (2019-2023), appears sound and appropriate for addressing the stated objectives. The clear aim and structured approach outlined in the abstract indicate a well-conceived piece of research. The findings present a nuanced picture. While both social assistance and GRDP per capita are found to have a statistically significant negative impact on income inequality—results that align with general economic theory and policy expectations—the finding regarding ZIS funds is particularly noteworthy. The study reveals that the distribution of ZIS funds has a negative but *insignificant* effect on income inequality. This specific outcome challenges the widely held belief in the direct and substantial impact of Islamic philanthropy on poverty and inequality at a macro-provincial level. This "insignificant" result is a critical point that warrants thorough discussion and interpretation within the full paper, exploring potential reasons such as the scale of ZIS distribution relative to the overall problem, the efficiency or targeting of its channels, or perhaps data limitations in capturing its true effect at an aggregated provincial level. From a policy perspective, the study offers important insights for Indonesian authorities. The significant impacts of social assistance and GRDP per capita underscore the continued importance of state-led welfare programs and sustained economic growth as key strategies for reducing inequality. However, the insignificant ZIS effect points to a crucial area for improvement and strategic reconsideration for zakat management institutions. The recommendation to optimize ZIS funds for mustahik empowerment and to increase public literacy and awareness is well-placed. Future research could delve deeper into the factors contributing to the insignificance of ZIS, perhaps through more granular data analysis, qualitative studies on distribution mechanisms, or an examination of regional variations in ZIS effectiveness. This would help unlock the full potential of Islamic philanthropy as a more potent tool against income disparity in Indonesia.

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