ZAKAT:

A FINANCING ALTERNATIVE
IN ACHIEVING SDG TARGETS

PROF. DR. BAMBANG SUDIBYO MBA. CA.

CHAIRMAN OF BAZNAS

THE 2nd ANNUAL ISLAMIC FINANCE CONFERENCE:

THE ROLE OF ISLAMIC FINANCE IN ERADICATING POVERTY AND
INCOME INEQUALITY, YOGYAKARTA, AUGUST 23-24, 2017

1
 ASNAF OF ZAKAT

َ ِ‫ين َو ْال َعا ِمل‬

‫ين َع َل ْي َها‬ ِ ‫ك‬
ِ ‫ا‬ ‫س‬ َ ‫م‬
َ ْ
‫ال‬ ‫و‬
َ ‫ء‬ ِ ‫ا‬‫ر‬َ َ
‫ق‬ ُ ‫ف‬ ْ
‫ل‬ ِ ‫ل‬ ُ
‫ات‬ َ
‫ق‬ َ‫َّد‬‫ص‬ ‫ال‬ ‫ا‬ ‫م‬
َ َّ
‫ن‬ ِ‫۞ إ‬
ِ َّ ‫يل‬
‫َّللا‬ ِ ‫ين َوفِي َس ِب‬ َ ‫ار ِم‬
ِ َ
‫غ‬ ْ
‫ال‬ ‫و‬ َ ‫ب‬
ِ ‫ا‬ َ
‫ق‬ ِّ‫الر‬ ‫ي‬ ‫ف‬
ِ ‫و‬ َ ‫م‬
ْ ُ
‫ه‬ ُ
‫ب‬ ‫و‬ُ ‫ل‬ُ ‫ق‬ ‫ة‬
ِ َ
‫ف‬ َّ ‫ل‬‫ُؤ‬ َ ‫م‬ ْ
‫ال‬ ‫َو‬
َّ ‫َّللا ۗ َو‬
‫َّللاُ َعلِي ٌم َح ِكي ٌم‬ ِ َّ ‫ض ًة ِم َن‬ َ ‫يل ۖ َف ِري‬ ِ ‫ْن الس َِّب‬ ِ ‫َواب‬
VERILY ZAKATS ARE FOR THE POOR AND THE NEEDY, THE
AMIL OF THE FUNDS’, THOSE WHOSE HEARTS HAVE BEEN
RECENTLY RECONCILED TO ISLAM, THOSE IN BONDAGE,
THOSE IN DEBT, IN THE CAUSE OF ALLAH, AND FOR THE
WAYFARER. THUS IS IT, ORDAINED BY ALLAH, AND ALLAH IS
FULL OF KNOWLEDGE AND WISDOM
(AT-TAUBAH 60).

2
 10 OUT OF 17 SDGs FIT
ASNAF OF ZAKAT
NO TARGETS 2030 ASNAF
1 NO POVERTY IN ALL ITS FORMS EVERYWHERE POOR, NEEDY, IN DEBT
NO HUNGER: ACHIEVE FOOD SECURITY AND IMPROVED
2 POOR, NEEDY, IN DEBT
NUTRITION AND PROMOTE SUSTAINABLE AGRICULTURE
3 GOOD HEALTH AND WELL BEING FOR ALL AT ALL AGES POOR, NEEDY, IN DEBT
INCLUSIVE AND EQUITABLE QUALITY EDUCATION & PROMOTE POOR, NEEDY, IN DEBT
4
LIFELONG LEARNING FOR ALL
5 GENDER EQUALITY
6 CLEAN WATER AND SANITATION FOR ALL POOR, NEEDY, IN DEBT
7 AFFORDABLE AND CLEAN ENERGY POOR, NEEDY, IN DEBT
8 DECENT WORK AND ECONOMIC GROWTH POOR, NEEDY, IN DEBT
9 INDUSTRY, INNOVATION AND INFRASTRUCTUR
10 REDUCED INCOME INEQUALITY WITHIN AND AMONG COUNTRIES. POOR, NEEDY, IN DEBT
11 SUSTAINABLE CITIES AND COMMUNITIES
12 RESPONSIBLE CONSUMPTION AND PRODUCTION
13 CLIMATE ACTION
14 LIFE BELOW WATER
15 LIFE ON LAND
POOR, NEEDY, IN DEBT, FI
16 PEACE, JUSTICE AND STRONG INSTITUTIONS
SABILILLAH
17 PARTNERSHIP FOR THE GOALS AMIL, FI SABILILLAH
3
GDP GROWTH, PROSPERITY, POVERTY,
AND SOCIAL DISPARITY
POVER POVER
GDP GDP/ GDP GDP/
-TY GINI -TY GINI
YEAR GROWTH CAPITA YEAR GROWTH CAPITA
RATE INDEX RATE INDEX
(%) (USD) (%) (USD)
(%) (%)
1985 2,5 658,2 2001 3,5 834,1 18,41 0,31
1986 6,0 610,2 O,34 2002 3,7 1.002,9 18,2 0,34
1987 4,8 562,9 17,40 0,32 2003 4,1 1.186,8 17,42 0,32
1988 6,0 621,9 0,32 2004 5,1 1.280,7 16,66 0,32
1989 7,5 696,9 0,33 2005 5,7 1.403,9 15,97 0,38
1990 7,2 770,8 15,10 0,33 2006 5.5 1.764,8 17,75 0,35
1991 7,0 847,6 0,33 2007 6,3 2.064,2 16,58 0,38
1992 6,5 907,8 0,33 2008 6,2 2.418,0 15,42 0,37
1993 6,5 1.013,1 13,70 0,34 2009 4,9 2.465,0 14,15 0,37
1994 7,5 1.115,6 0,34 2010 6,1 3.178,1 13,33 0,38
1995 8,2 1.254,0 0,34 2011 6,5 3.688,5 12,36 0,41
1996 7,8 1.394,5 17,47 0,36 2012 6,23 3.744,5 11,66 0,41
1997 4,7 1.308,1 0,35 2013 5,78 3.675,6 11,47 0,41
1998 -13,1 572,1 24,2 0,35 2014 5,02 3.531,8 11,13 0,41
1999 0,8 829,6 23,43 0,31 2015 4,79 3.362,4 11,25 0,41
2000 4,9 870,2 19,14 0,30 2016 5,01 3.635,8 10,86 0,40

4
 IMPACTS OF MONETARY CRISSIS 97/98

MONCRIS 97/98 LEFT VERY SAVIOR DENTS ON INDONESIAN

ECONOMY:
 GDP GROWTH DROPED FROM 7,8% IN 1996 TO -13,1% IN 1998
 GDP PER CAPITA DROPED 59% FROM USD1.394,5 IN 1996 TO
USD572,1 IN 1998
 POVERTY RATE ROSE UP FROM 17,47% IN 1996 TO 24,2% IN 1998
 WITH IN 18 YEARS SINCE MONCRIS 97/98 POVERTY RATE
GRADUALY DECREASED FROM 24,25% IN 1998 TO 10.86% IN 2016
 HOWEVER WITH IN THE SAME PERIOD, SOCIAL DISPARITY HAS
INCREASED STEADILY, AS INDICATED BY GINI INDEX, FROM 0,35
IN 1998 TO 0,41 IN 2011-2015 AND THEN DROPPED A BIT TO 0,40
IN 2016
 GINI INDEX HAS BEEN CONSISTENTLY IN THE RED (≥ 0,40) SINCE
2011
 STRONG INDICATION OF MIDDLE INCOME TRAP IN 2011-2016

5
CHALLENGES OF POVERTY ERADICATION

 WITH IN 18 YEARS SINCE MONCRIS 97/98 POVERTY RATE HAS GRADUALY

DECEASED FROM 24,25% IN 1998 TO 10.86% IN 2016.
 THE AVEARAGE ANNUAL DECREASE IS 0,74%/YEAR
 THE POVERTY RATE CALCULATION WAS BASED ON SPENDING OF
USD1.25/CAPITA/DAY OR EQUIVALENT TO ± Rp2.344.125/FAM./MO.
 IF THIS ACHIEVEMENT COULD BE CONSISTENTLY MAINTAINED, ASUMING
CETERIS PARIBUS, ABSOLUTE POVERTY WOULD THEN BE ERADICATED IN
14,7 YEARS OR IN THE YEAR 2031.
 THUS, SDG POVERTY TARGET 0F 2030 WOULD THEN BE ACHIEVED ONLY
BY SMALL EFFORTS OF ACCELERATION
 HOWEVER, THE MORE PREVALENT MEASURE OF POVERTY IS NOT
USD1.25/CAPITA/DAY, BUT USD2/KAPITA/DAY OR ± Rp3.750.600/FAM./MO.
 THIS AMOUNT IS VERY CLOSE TO THE NISHAB OF ZAKAT FOR HOUSEHOLD
INCOME BASED ON GOLD ± Rp3,700,000/FAM./MO., AND THEREFORE IS
MORE ISLAMIC.
 IF THE MORE PREVALENT MEASURE WAS USED THEN POVERTY RATE
WOULD JUMP APPROACHING 40%, MEANING THAT THE EFFORTS TO
ACHIEVE SDG POVERTY TARGETS IN 2030 SHOULD BE 368% OF THOSE
ALREADY BEEN DONE IN THE LAST 18 YEARS

6
EFECTIVENESS OF ZAKAT FOR POVERTY ERADICATION
(EMPIRICAL EVIDENCE)

MOHEIDIN, IQBAL,
ROSTOM, AND FU
(2011) FOUND
SUPPORTING
EVIDENCE THAT
20 INCLUDING
INDONESIA OUT
OF 39 OIC
COUNTRIES CAN
ACTUALLY
ALLEVIATE THE
POOREST LIVING
WITH INCOME
UNDER $1.25 PER
DAY OUT OF THE
POVERTY LINE
SIMPLY WITH
PROPER ZAKAT
COLLECTION AND
MANAGEMENT.

7
Source: Moheidin et al (2014): Enhancing Financial inclusion Through Islamic Finance
 COMPARATIVE SOCIAL DISPARITY
AMONG RELEVANT COUNTRIES
COUNTRIES GIN INDEX 2014
THAILAND 0,53.1
IT IS EMPIRICALLY NOT
MEXICO 0,517
SUPPORTED THE OPINION OF
BRAZIL 0,516
THOSE WHO BELIEVE THAT
CHINA 0,48.0 SOCIAL DISPARITY IS THE PRICE
SINGAPORE 0,473 THAT MUST BE SACRIFICED FOR
USA 0,450 ECONOMIC DEVELOPMENT
MALAYSIA 0,462
FILIPPINES 0,458 THE GOI MUST LEARN A LOT
INDONESIA 0,410 FROM GERMANY, AUSTRALIA,
VIETNAM 0,376 SOUTH KOREA, TAIWAN, FRANCE,
JAPAN 0,376 AND UK, ADVANCED COUNTRIES
INDIA 0,368 WITH RELATIVELY FAIR SOCIAL
UK 0,340
DISPARITY
FRANCE 0,327
TAIWAN 0,326
SOUTH KOREA 0,310
AUSTRALIA 0,305
GERMANY 0,270 11
SENSITIVITY OF SOCIAL DISPARITY
IN INDONESIA

 EXTREME SOCIO-ECONOMIC DISPARITY IN INDONESIA IS

VERY RISKY AND DANGEROUS, BECAUSE:
 SOCIO-ECONOMIC MAPS OF THE NON-PRIBUMI GROUP
COINSIDE ALMOST COMPLETELY WITH THAT OF THE
NON-MUSLIM GROUP AND THAT OF THE AFFLUENT
GROUP. AS A RESULT, SOCIO-ECONOMIC JEALOUSY IS
HEAVILY LEADEN WITH SARA PREJUDICE.
 THE SOCIO-ECONOMIC JEALOUSY LEADEN WITH SARA
PREJUDICE IS OFTENLY ABUSED BY POLITICAL
VESTED INTERESTS IN THE EXPENSE OF NATIONAL
UNITY AND STABILITY.

9
 ROUGH SOCIO-ECONOMIC MAPS

MUSLIM-NON-MUSLIM AFFLUENT-POOR
PRIBUMI-NON PRIBUMI
15%
6%
12% REACHEST

88% 85%
MUSLIM 94%
PRIBUMI

Muslim Non-Muslim Pribumi Non-Pribumi POOR AFFLUENT

THE MAP OF THE NON-MUSLIM COINSIDE ALMOST

COMPLETELY WITH THAT OF THE NON-PRIBUMI AND
THAT OF THE AFFLUENT

10
 THE RISE OF THE MIDDLE AND UPPER CLASSES

 MIDDLE CLASS ARE THOSE WITH DAILY SPENDING OF $2-20 (WB, ADB)
 UPPER CLASS ARE THOSE WITH DAILY SPENDNG OF >$20

SOCIAL CLASSES SPENDING/CAPITA/DAY

ELITE > $50

UPPER
AFFLUENT > $20-50
UPPER MIDDLE ≥ $6-20
MIDDLE ≥ $4-6
MIDDLE
EMERGING
≥ $2-4
MIDDLE

ASPIRANT > $1.25-2

LOWER
POOR ≤ $1.25

 MIDDLE AND UPPER CLASSES GROWS VERY FASTLY

11
GROWTH OF MIDDLE AND UPPER CLASSES

 THE GROWTH OF MIDDLE CLASS IN NDONESIA SINCE MONCRIS

97/98 WAS FENOMENAL. ACCORDING TO JPNN.COM IT WAS THE
FASTEST IN THE WORLD
 SOCIAL CLASS STRUCTURE IN 2012 COMPARED TO ITS
PROJECTION IN 2020:

SOURCE: BCG, JPNN.COM

12
SHIFT IN SOCIAL CLASS STRUCTURE
WORSENING SOCIAL DISPARITY
2012 2020
AVERAGE ANNUAL
SOCIAL CLASS MILLION MILLION
% % GROWTH
PEOPLE PEOPLE
ELITE 2,5 6,9 22%
3,67 8,74 19,6%
AFFLUENT 6,6 16,5 18,75%
UPPER MIDDLE 23,2 49,3 14,6

MIDDLE 41,6 68,2 7,95

44,00 62,78 6,7%
EMERGING
44,4 50,5 1,7%
MIDDLE

ASPIRANT 65,4 47,9 -3,3%

52,33 28,48 -6,7%
POOR 64,5 28,3 -7,01%

 NOT ONLY THE MIDDLE CLASS THAT GROWS FASTLY. THE UPPER
CLASS GROWS EVEN 3X FASTER THAN THE MIDDLE CLASS.
 DEVELOPMENT PROVIDE BENEFITS TO EVERY CLASS. HOWEVER,
BENEFITS ACCRUE TO THE HIGHER CLASS IS BIGGER THAN THOSE
ACCRUE TO THE LOWER CLASS.
 THUS, SOCIAL DISPARITY IS WIDENING THERE MUST BE SOMETHING
WRONG WITH THE ECONOMIC DEVELOPMENT POLICIES
13
ARE THESE POLICIES CONTRIBUTE THE
THE WORSENING OF SOCIAL DISPARITY?

PRANSFER OF WEALTH POLICIES BENEFITTING THE WEALTHY

CROOKS:
 BLBI 1998 OF Rp160T, EQUIVALENT TO 36,9% OF GDP 1997
(Rp433,25T)
 BANK RACAPITALIZATION 1999/2000 OF RP640T AS AN
IMPLEMENTATION OF LOI WITH THE IMF WITH EXPENSIVE
CONSEQUENCES OF INTEREST SUBSIDY TO THE
RECAPITALIZATION BONDS OF ROUGHLY Rp60T/YEAR.
APROXIMATE AMOUNT OF THE SUBSIDY FOR THE PERIOD 2001-
2016 IS 16X60T = Rp960T.
 TAX AMNESTY WITH OBJECTIVE OF RETURNING BACK CAPITAL
FLED ABROAD DURING THE MONCRIS OF 97/98
 WHO ARE THE MAIN BENEFICIARIES OF THESE POLICIES? THEY
ARE ALMOST THE SAME GROUP.
 HOW THESE POLICIES RELATE TO THE RISE OF GINI INDEX
DURING THE REFORM ERA?

14
 ZAKAT POTENTIAL IN INDONESIA
FIRDAUS ET AL (2012) PROJECTED ZAKAT POTENTIAL IN 2010 ± Rp217 T:

SUBJECT OF ZAKAT ZAKAT POTENTIAL (Rp)

HOUSE HOLD 82,70 T
PRIVATE COMPANES 114,89 T
STATE OWNED COMPANIES 2,40 T
BANK DEPOSITS DAN SAVINGS 17,00 T
TOTAL 217,00 T

IF ZAKAT FROM COMPANIES WERE EXCLUDED BECAUSE OF THE

DIFFICULTIES IN REALIZING ZAKAT POTENTIAL OF THIS GROUP, THAN THE
MORE REALISTIC ZAKAT POTENTIAL IN 2010 IS APPROXIMATELY Rp100T.
BY EXTRAPOLATION, CONSIDERING GDP GROWTH IN 2011, 2012, 2013,
2014, 2015, 1ND 2016 ARE RESPECTIVELY 6,50, 6,23, 5,78, 5,02, 4,79, AND
5,01, THEN ZAKAT POTENTIAL IN 2016 IS Rp138T.

SOURCE: Modified from Muhammad Firdaus, Irfan Syauqi Beik, Tonny Irawan dan Bambang Juanda (2014) :
“ Economic Estimation and determinations of zakat potential in Indonesia,” IRTI (IDB) Working Paper Series.

15
 STATISTIC OF NATIONAL ZIS COLLECTION BY
LEGAL AMIL ZAKAT
GDP
ZIS GROWTH
YEAR GROWTH REMARK
(BILLION RP) (%)
(%)
2002 68,39 - 3,7
2003 85,28 24,70 4,1
2004 150,09 76,00 5,1
TSUNAMI ACEH AVERAGE
2005 295,52 96,90 5,7
GROWTH
2006 373,17 26,28 5.5
OF ZIS
2007 740,00 98,30 6,3 YOGYA EARTH QUAKE WAS FAR
2008 920,00 24,32 6,2 ABOVE
2009 1.200,00 30,43 4,9 THAT OF
2010 1.500,00 25,00 6,1 GDP
2011 1.729,00 15,30 6,5
2012 2.200,00 27,24 6,23
2013 2.700,00 22,73 5,78
2014 3.300,00 22,22 5,02
2015 3.700,00 21,21 4,79
2016 5.015,49 37,41 5,01
AVERAGE GROWTH 37,22 5,40
SORCE: BAZNAS 16
 POTENTIAL EXPLANATIONS

WHY AVERAGE GROWTH OF ZIS WAS FAR ABOVE THAT OF

GDP?
1.IMPROVEMENT OF RELIGIOUSITY OF THE MUSLIM
UMMAH.
2.MORE MUSLIM PEOPLE PAID THEIR ZAKAT DUTIES
THROUGH LEGAL AMIL ZAKAT (BAZNAS AND LAZ),
3.FAST GROWTH OF THE MIDDLE AND UPPER CLASSES.

CONSIDERING THE HIGH POTENTIAL OF ZAKAT (Rp138 T IN

2016) AND THE HIGH GROWTH OF ZIS (37,22% ANNUALLY),
THE GOI SHOULD USE THIS SYARIAH FINANCIAL
OPPORTUNITY FOR POVERTY ERADICATION BY IMPROVING
CONTROLABILITY OF ZAKAT COLLECTION AND
DISTRIBUTION

17
 IMMEDIATELY CONTROLLABLE
ZAKAT FOR POVERTY ERADICATION
 THE GOI CAN AND SHOULD UTILIZED ZAKAT AS EXTRA-APBN/APBD SOURCE OF
FUND FOR THE POVERTY ERADICATION PROGRAMS:
 FULLY SUPPORT BAZNAS IN COORDINATING 34 BAZNAS PROVINCES, 514
BAZNAS KABUPATENS/CITIES, 16 LAZ-NATIONALS, AND 32 LAZ-SUB-
NATIONALS IN THE EXTRA-APBN/APBD POVERTY ERADICATION PROGRAMS.
 AMEND INPRES 3/2014 CONCERNING ZAKAT COLLECTION OPTIMALIZATION
THROUGH BAZNAS INTO A MORE STRIGHT FORWARD INSTRUCTION TO
COLLECT 2,5% ZAKAT FROM SALARIES OF THE MUSLIMS IN APBN, APBD,
PAYROLS OF BUMN, AND PAYROLS OF BUMD.
 BAPPENAS HAS STRENGTHENED THE CONTROLLABILITY BY INCLUDING
ZAKAT IN THE MASTERPLAN ARSITEKTUR KEUANGAN SYARIAH. THE
IMPLICATION OF THIS INCLUSION IS THAT ALL BAZNASes AND ALL LAZes ARE
TO BE SUPERVISED AND CONTROLED BY THE OJK.
 ROUGH ESTIMATION OF IMMEDIATELY CONTROLABLE ZAKAT IN 2017:
SOURCES CALCULATION AMOUNT (Rp T)
APBN 88% X 342,5T X 2,5% 7,535
APBD 88% X 402,9T X 2,5% 8,864
BUMN 88% x PAYROL X 2,5% ?
BUMD 88% x PAYROL X 2,5% ?
Rp16,399T + ? + ? =
TOTAL MORE THAN Rp 20T OR >14,5% OF
ZAKAT POTENTIAL IN 2016
18
19