The Impact of Zakat on Economic Growth in Malaysia


  • Noorkartina Mohamad Islamic Collage University of Perlis
  • Nor Ermawati Hussin Islamic Collage University of Perlis
  • Nor Musfirah Mohamad


Zakat, Income Distribution, Poverty, Economic Growth


In macroeconomics, zakat expected to effect in several aspects such as income distribution, economics performance, wealth, poverty, aggregate consumption, national saving, investment and aggregate production, social security and allocation efficiency. Zakat also considered as an instrument in a fiscal policy in Islamic community. The distribution of Zakat increases the consumption of essential goods and services and at once also reduce the poverty and income gap. Thus, this study aims to investigate the impacts of zakat on economic growth for several states In Malaysia. With using the panel data from 2006 to 2018 with Pedroni Cointegration and FMOLS tests, the result shows that zakat are correlate with economic growth for several states. Thus, this paper suggested that an economic growth was also affected by the numbers of zakat collection.