Overcoming Income Disparity amongst Bumiputera by Improving Zakāt and Waqf System: A Special Focus on Improving Assets Management and Accounting Transparency

Abidullah Abid, Muhammad Hakimi Mohd Shafiai


This paper aims to highlight the issues in Zakāt and Waqf in Malaysia and to provide a solution so that the income disparities amongst the Malay ethnic group can be minimized. Through library reach methods, we explored the literature in order to come up with the concrete conceptual model. It is found from the thorough study of literature that in the current SIRC, the issues of assets management and accounting transparency exist that make the Zakāt and Waqf system more vulnerable. Hence, it is suggested that Shari’ah Council might outsource some of its responsibilities to Islamic Microfinance Institutions so that the issues of assets management and accounting transparency can be overcome. The conceptual model that is presented in the study would provide more structured and transparent Zakāt and Waqf collection and distribution process for the Shari’ah Council so that maximum benefits can be derived in the interest of the Muslim Malays.


Income disparity, Islamic Wealth Redistribution, Shari’ah Islamic Religious Council, Zakāt, Waqf, Accounting Transparency, Cash Management, Islamic Microfinance

Full Text:



Ab Rahman, A., Alias, M.H., & Syed Omar, S.M.N. (2012). Zakāt Institution in Malaysia : Problems and Issues. Global Journal Al-Thaqafah, 2(1), 35–42.

Abdul-Rahman, A.R., & Goddard, A. (1998). An Interpretive Inquiry of Accounting Practices in Religious Organisations. Financial Accountability and Management, 14(3), 183–201. doi:10.1111/1468-0408.00060

Alesina, A., & Rodrik, D. (1994). Distributive Politics and Economic Growth. The Quarterly Journal of Economics, 109(2), 465–490.

Anand, S. (1983). Inequality and Poverty in Malaysia : Measurement and Decomposition. New York: Oxford University Press.

Binti Ibrahim, D., & Haslindar, B.I. (2013). Revitalization of Islamic Trust Institutions through Corporate Waqf. In International Conference on Business and Economic Research (pp. 192–202). Bandung.

Birdsall, N. (2005). Why Inequality Matters in a Globalizing World. Helsinki: Center for Global Development.

Birdsall, N. (2012). Why Inequality Matters: Some Economic Issues. Ethics & International Affairs, 15(02), 3–28. doi:10.1111/j.1747-7093.2001.tb00356.x

Bourguignon, F. (2004). The Poverty-Growth-Inequality Triangle. In Indian Council for Research on International Economic Relations. New Dehli.

Chowdhury, M.S.R., Ghazali, M. F. Bin, & Ibrahim, M. F. (2011). Economics of Cash WAQF management in Malaysia: A Proposed Cash WAQF Model for Practitioners and Future Researchers. African Journal of Business Management, 5(30), 12155–12163. doi:10.5897/AJBM11.1810

Cizakca, M. (2004). Ottoman Cash Waqfs Revisited : The Case of Bursa 1555- 1823. Manchester.

DOS. (2011). Population Distribution and Basic Demographic Characteristics 2010. Putrajaya: Department of Statistics.

Hisham, Y. (2006), “Waqf accounting in Malaysian state Islamic religious institutions: the case of Federal territory SIRC”, unpublished Master's dissertation, International Islamic University Malaysia, Kuala Lumpur.

Hennigan, P. C. (2004). The Birth of Legal Institution: The Formation of Waqf in Third-Century A.H. Hanafi Legal Discourse. Boston: Brill Publishers.

Ihsan, H., & Hameed Hj. Mohamed Ibrahim, S. (2011). WAQF Accounting and Management in Indonesian WAQF institutions. Humanomics, 27(4), 252–269. doi:10.1108/08288661111181305

Isa, Z.M., Ali, N., & Harun, R. (2011). A Comparative Study of Waqf Management in Malaysia, 10, 561–565.

Keister, L.A., & Moller, S. (2000). Wealth Inequality in the United States. Annual Reviews, 26, 63–81.

Khalid, M.A. (2011a). Household Wealth in Malaysia : Composition and Inequality among Ethnic Groups, 45(Jurnal Ekonomi Malaysia), 71–80.

Khalid, M.A. (2011b). NEP to NEM : Who Cares ? Wealth Distribution in Malaysia, 1, 400–409.

Khalid, M.A. (2014). The Colour of Inequality. Petaling Jaya: MPH Group Publishing Sdn Bhd.

Kuran, T. (2001). The Provision of Public Goods under Islamic Law : Origins, Impact, and Limitations of the Waqf System. Journal of the Law and Society Association, 35(4), 841–898.

Landes, D. (1998). The Wealth and Poverty of Nations : Why Some are So Rich and Some So Poor. New York: W.W. Norton.

Layish, A. (1997). The Family Waqf and the Sharʿī Law of Succession in Modern Times. Islamic Law and Society, 4(3), 352–388.

Lubis, M., Yaacob, N.I., Omar, Y., & Dahlan, A.A. (2011). Enhancement of Zakāt Distribution Management System : Case Study in Malaysia. International Islamic University, Malaysia.

Masruki, R., & Shafii, Z. (2013). The Development of Waqf Accounting in Enhancing Accountability. Middle-East Journal of Scientific Research, 13, 1–6. doi:10.5829/idosi.mejsr.2013.13.1873

Md Saad, N., Kassim, S., & Hamid, Z. (2013). Involvement of Corporate Entities in Waqaf Management: Experiences of Malaysia and Singapore. Asian Economic Financial Review, 3(6), 736–748.

Mohammad, M.T.S. (2008). Sustaining the Means of Sustainability: The Need for Accepting Wakaf (Waqf) Assets in Malaysian Property Market. In The 14th Annual Conference of the Pacific Rim Real Estate Society. Kuala Lumpur. Retrieved from http://eprints.utm.my/5715/1/Tahir_Sabit_Sustaining_The_Means_Of_Sustainability.pdf

Ortiz, I., & Cummins, M. (2011). Global Inequality: Beyond the Bottom Billion. Social and Economic Policy. New York.

Othman, A.B., & Mohd Noor, A.H. (2012). Role of Zakāt in Minimizing Economic Inequalities among Muslim: A Preliminary Study on Non Recipients of Zakāt Fund ( NRZF ). In 3rd International Conference of Business and Economic Research (pp. 1209–1222). Bandung.

Owolabi Yusuf, M., & Mat Derus, A. (2013). Measurement Model of Corporate Zakāt Collection in Malaysia. Humanomics, 29(1), 61–74. doi:10.1108/08288661311299321

Ragayah, H.M.Z. (2008a). Explaining the Trends in Malaysian Income Distribution. Kuala Lumpur: Universiti Kebangsaan Malaysia.

Ragayah, H.M.Z. (2008b). Income Inequality in Malaysia. Asian Economic Policy Review, 3(1), 114–132. doi:10.1111/j.1748-3131.2008.00096.x

Raimi, L., Bello, M.A., & Mobolaji, H. (2010). Faith‐based Model as a Policy Response to the Actualisation of the Millennium Development Goals in Nigeria. Humanomics, 26(2), 124–138. doi:10.1108/08288661011074927

Riwajanti, N.I. (2013). Islamic Microfinance as an Alternative for Poverty Alleviation : A Survey. Afro Eurasian Studies, 2(1&2), 254–271.

Saduman, S., & Aysun, E.E. (2009). the Socio-Economic Role of Waqf System in the Muslim- Ottoman Cities ’ Formation and Evolution. Trakia Journal of Sciences, 7, 272–275.

Senturk, O. (2007). Charity in Islam : A Comprehensive Guide to Zakāt. Somerset N.J.: Light Inc.

Shireen, M.H. (1998). Income Inequalities and Poverty in Malaysia (Vol. 24). Kuala Lumpur: Lanham Md Rowman & Littlefield Publishers. doi:10.1080/10511253.2012.730617

Syed Abdul Kader, S.Z., & Md. Dahlan, N.H. (2006). Current Legal Issues Concerning AWQAF in Malaysia. University Utara Malaysia Repository, 27–38.

Vorbeek, J. (2015). Global Monitoring Report 2014 2015: Ending Poverty and Sharing Prosperity. Washington DC.

Wouters, P. (2013). Elements of Islamic Wealth Management. In K. Hunt-Ahmad (Ed.), Contemporary Islamic Finance: Innovation, Applications and Best Practices (pp. 147–164). New Jersey: John Wiley & Sons, Inc.

Zain, S.R.M. (2005). Determinants of Financial Reporting Practices on Waqf by Malaysian State Islamic Religious Council in Malaysia. Unpublished Masters Dissertation. International Islamic University Malaysia, Kuala Lumpur.

Journal of Philanthropy, Vol 1, Issue 1, July – December 2017

Zimmer, Z. (2008). Poverty, Wealth Inequality and Health among Older Adults in Rural Cambodia. Social Science & Medicine (1982), 66(1), 57–71. doi:10.1016/j.socscimed.2007.08.032


  • There are currently no refbacks.


Journal of Philanthropy (JoPH)
Print ISSN: 
Online ISSN: 

Published by
Islamic Economic Studies and Thoughts Centre (IESTC)
Bangi, Malaysia  
Phone : +(021)-3904555, Fax.: +6221–3913777
E-Mail: journal@iestc.net