The International Journal
of Not-for-Profit Law

Volume 8, Issue 2, November 2005

By Alfitri1

A. Introduction

Zakat is an obligation of Muslims to give a specific amount of their wealth – with certain conditions and requirements – to beneficiaries called al-mustahiqqin.2 The concept of zakat exemplifies Islam’s strong concern with social and economic justice. It serves as an “equitable redistribution of wealth and income, which is enforced through moral obligation and fiscal measures.”3

As many have argued, however, the redistributive economic impact of zakat depends on how it is administered, especially with regard to collection and distribution.4 Unfortunately, the administration of zakat in Indonesia is not adequate, and therefore the full potential of zakat has not yet been realized. 5 Much remains to be done.

Indonesia’s difficulty in zakat management stems from the fact that Indonesia is not an Islamic state. The willingness of a regime to regulate zakat administration directly very much depends on its policy toward Islam. Meanwhile, the voluntary sector’s role in zakat management depends in part on the availability of facilitative law, which has the potential to enhance credibility and accountability and thereby foster public trust.

Significantly, the Indonesian government did promulgate a law of zakat management in 1999. This article will examine the law, its background, and its impact on the existence of nongovernmental zakat collectors in Indonesia.

B. Zakat and the Argument for State Involvement

1. The Concept of Zakat

There are two types of zakat in Islam: a flat fee imposed on each person, called zakat al-fitr, and a tax on wealth, called zakat al-mal.6 Zakatal-fitr refers to the obligation of every Muslim (except those who are absolutely destitute) to contribute a certain amount of staple food or pay an equivalent monetary amount in the month of Ramadan before the Muslim festive season celebration known as Eid al-Fitr.7 The zakatal-fitr flat fee is one sa` – a little more than two kilograms of wheat, barley, dates, or rice – or the monetary equivalent.8 All Muslims – including the poor, as long as they will still have food for the first day of Eid al-Fitr – must pay zakatal-fitr for themselves and their dependents.9 The proceeds are devoted to helping feed the needy during the Eid al-Fitr celebration. Accordingly, even though many have-nots must pay zakat al-fitr, they are also the major recipients of the proceeds.10 In practice, payers usually give zakat al-fitr directly to beneficiaries without interference from the state or any other third party.11

Unlike zakatal-fitr, zakatal-mal is levied only on Muslims whose wealth exceeds a threshold called nisab.12 Before nisab is calculated, the basic needs of the payer and his family, as well as their financial obligations and debts due, are taken into account. Further, the funds are held for one year by the lunar calendar, and nisab is recalculated at the end.13 These requirements distinguish zakatal-mal from zakatal-fitr, and enable zakatal-mal to be regulated by the state much like a tax.

God commanded the Prophet Muhammad, as the head of the Islamic community in Medina, to collect zakat. This command is enshrined in the Qur’an, chapter IX: 103, and it is a persuasive argument for a Muslim state to be involved in zakat collection and distribution.14 As a matter of fact, the collection and distribution of zakat al-mal was managed by the state in the era of the Prophet and his successors (the four rightly guided caliphs),15 and it continued to be a function of Muslim governments until the fall of Ottoman Empire.16 Furthermore, much like a tax, the minimum threshold of zakat on savings or investments is 85 grams of gold, and the rate of zakat is 2.5%; as for livestock, both the minimum threshold and the rate depend on the type and the number of animals.17

2. Management of Zakat: State vis-à-vis Civil Society Organizations

Management of zakat is financially self-sustaining. Those who collect and distribute zakat al-mal are paid from zakat proceeds. Zakat collectors are among the zakat al-mal beneficiaries in Islam.18 Hence, imposing the obligation of collecting and distributing zakat on the state does not burden the national budget.19

If a state is unable or unwilling to administer zakat – such as a state that does not implement Shariah (Islamic law) and maintains a secular stance, or one where Muslims are a minority – the voluntary sector must undertake the role of gathering and distributing zakat for the benefit of the community.20 This is because managing zakat is a religious obligation imposed on the state or those who are responsible for Islamic affairs.21 If the state does not fulfill this function, Islamic tenets require that it be carried out on behalf of the entire Islamic society by any Muslim in the region. If the collection and distribution of zakat is not performed, the Islamic society in the region will face responsibility for this disobedience on Judgment Day.22 (The importance of the state or the voluntary sector in zakat collection and distribution does not negate the individual’s payment directly to zakat recipients. As long as zakat payers fulfill the requirements of zakatability23 and channel their funds to appropriate recipients, their payments are considered valid.)

In order to implement zakat properly, involvement by the state or voluntary sector is indispensable. Zakat differs from the voluntary act of giving alms, such as sadaqah and infaq in Islam, or tithing in Christian churches.24 It is a religious obligation that employs a form of taxation with very specific rules.25 Zakat payers who calculate and make their payments in every Ramadan month, for example, neglect the requirement that zakat must be held, recalculated, and paid after one lunar year; likewise, distributing zakat evenly to all who seem needy is invalid.26 If zakat implementation does not meet the religious requirements, it becomes a mere voluntary act of giving alms. In addition, zakat should be well managed and strategically distributed on the grounds of fairness, lest some deserving recipients receive too much while others receive too little.

C. Law No. 38/1999 of Zakat Management and the Philanthropic Sector

1. Zakat Management in Indonesia before Law No. 38/1999

Involvement of the state in managing zakat was somewhat unclear in early Indonesia. Even though the state founded the Ministry of Religion in January 1946 and assigned it (among other things) to administer Islamic religious matters,27 the role of this Ministry was uncertain from the start. Government Regulation No. 33/1949, amended by Government Regulation No. 8/1950, and Regulation of the Minister of Religion No. 5/1951, did not assign zakat matters to the Ministry.28 The exclusion of zakat also can be seen from the original structure of the Ministry in 1946: it contained only bureaus of Islamic Religious Information, Islamic Marriages, and Islamic Education.29

There was a hope that the state would become more concerned about zakat when Soeharto ascended to the presidency in 1967. However, his regime showed an ambivalent attitude toward Islam. Early during his reign, Soeharto severely controlled political Islam but strongly supported Islamic spirituality.30 This ambivalence can be seen in Soeharto’s stated willingness to take charge of the “massive national effort of zakat collection” and to take a hand in collecting and distributing zakat reports annually, as he said in his official speech celebrating Isra’ Mi`raj (the Prophet Muhammad’s ascension) at the Merdeka Palace in October 1968.31 The service that Soeharto offered, however, was on behalf of himself as a Muslim private citizen, and not as President. Because he aimed to maintain a clear distinction between religion and the state, he could not act as a provisional zakat collector in his official capacity as head of state.32

Not long after his first appeal, Soeharto officially instructed three high military officers to establish an organizational apparatus for the nationwide zakat collection. Presidential Decree No. 07/PRIN/10/1968 gave impetus to incorporating the matters of zakat into the responsibilities of the state.33 The governor of Jakarta, Ali Sadikin, was the first official to implement the Presidential decree by issuing a gubernatorial decision to establish a semi-autonomous zakat agency, called BAZIS, for Jakarta in December 1968.34 East Kalimantan formed its BAZIS in 1972, followed by West Sumatra in 1973, West Java and South Kalimantan in 1974, and North Sulawesi and South Sulawesi in 1985.35 The BAZIS administration in each province had a structure quite similar to that BAZIS of Jakarta, with the governor as general chairman assisted by an executive chairman and a board of advisers.36 Following the structure of government at the administrative level, each provincial BAZIS also had three basic levels: regency (kotamadya or kabupaten), district (kecamatan), and village (kelurahan).37

The state-endorsed zakat organizations have not been alone in zakat management. Besides the BAZIS and the traditional system of zakat payment, which still continues, a second system of zakat collection and distribution has also flourished through Islamic social and educational organizations.38 Many of these organizations are branches of national Islamic organizations such as Muhammadiyah or Nahdatul Ulama. They work in a local area and are more oriented to their communities in using zakat proceeds.39

Unfortunately, the enthusiasm of the voluntary sector in zakat management has not been matched by clear regulations to strengthen its structures and accountability. Thus, the nature of zakat organizations is fragmented. The semi-governmental BAZIS were formed by gubernatorial decisions, while the Islamic social and educational organizations simply followed the regulations on foundations, with no specific zakat regulations at first.

The problem was somewhat ameliorated in 1991, when the Minister of Religion and the Minister of Home Affairs issued a joint decision (Surat Keputusan Bersama, or SKB) on the supervision and guidance of BAZIS.40 Article 1 stipulates that a BAZIS is a voluntary organization that manages the acceptance, collection, distribution, and utilization of zakat (as well as the voluntary forms of giving: infaq and sadaqah).41 This SKB thus excluded from its coverage the quasi-state institutions also known as BAZIS.42 Further, the SKB exemplifies the ambivalent attitude of the state toward Islam. On the one hand, the state takes advantage of the enthusiasm of its local apparatuses and local citizens in managing zakat. On the other hand, the state is reluctant to legislate zakat into law or to assign its own officials to function as national or regional collectors.43

Moreover, the SKB confirmed the findings of the Philanthropy and Law in South Asia (PALISA) project team, which conducted research in Bangladesh, India, Nepal, Pakistan and Sri Lanka, that Indonesian “philanthropic and nonprofit organizations are registered and regulated through multiple channels.”44 This is true for the nongovernmental BAZIS. Before the promulgation of Law No. 16/2001 on foundations, establishing a foundation in Indonesia was straightforward: the founders would authenticate their purposes and agreement to the public notary,45 they would register the act of the public notary in the district court and then announce it in the State Gazette,46 and the foundation would be officially established with state supervision. If, however, the foundation also would function as a zakat collector, it would be subject to the supervision of officers of the Ministry of Home Affairs and the Ministry of Religion from the central level to the regional level. In this way, laws and regulations with regard to the status and registration of BAZIS fell short during this period.

2. The Law of Zakat Management and Its Effectiveness

The demise of Soeharto’s authoritarian New Order regime in May 1998 brought about many changes in Indonesia. In terms of politics, the changes were marked by the emergence of 181 political parties between May and October 1998.47 Surprisingly, this occurred at a time when Indonesia faced socioeconomic and political uncertainty as a result of monetary crisis of 1997, which had caused the collapse of the economy and triggered riots in a number of big cities.48

The political euphoria surrounding Soeharto’s fall also provoked many Muslims to form political parties. Having being marginalized politically in both the Soekarno and Soeharto regimes, 42 of the 181 parties used Islam as their ideological basis or symbol.49 Whether for religious or political reasons, some of the Islamic parties campaigned on the perennial issue of Islam and state as well as the implementation of Shariah. Outside the political arena, too, some Islamic groups emerged to fight the degradation of socio-religious and political circumstances, which, they argued, conflicted with Islamic values; they called for Shariah implementation.50

Against this backdrop, Law of Zakat Management No. 38/1999 was enacted by B. J. Habibie, who ascended to the presidency in this transition period, replacing Soeharto. It is not clear whether the transition sovereign recognized the potency of zakat to deal with impoverishment during the economic collapse or simply sought to win Muslim political support before the 2000 presidential election in the People’s Consultative Assembly. Law No. 38/1999, however, seemed to promise enhanced direction and accountability to zakat collector agencies in Indonesia. The Law covers both the semi-governmental collector agencies and the nongovernmental ones. It requires balance auditing and annual reports to the government, and encourages public disclosure.51

Soon after, the Minister of Religion issued Decision No. 581/1999 on the Implementation of Law No. 38/1999 (MRD No. 581/1999). Together, the Law and the Decision specifically address government-formed zakat collector bodies, known as BAZ, and nongovernmental collector institutions, known as LAZ.52 Both BAZ and LAZ have the same functions: to collect, distribute, and utilize efficiently zakat proceeds – both zakatal-mal and zakatal-fitr – as well as other charity funds in Islam, “according to the stipulation of Islamic tenets.”53

But the shortcomings of the Law and the Decision soon became clear. Neither of them, for example, elaborates on the phrase “according to the stipulation of Islamic tenets.” Likewise, though it stipulates zakatable items in article 11 sections 1 and 2, Law No. 38/1999 simply asserts in section 3 that the calculation, nisab, rate, and time of payment should follow Islamic law.54 In fact, the concepts of zakat in Islamic jurisprudence may vary from one Islamic school of law to another, and they are scattered throughout the books of Islamic law.

In addition, Law No. 38/1999 generally regulates the institutions that manage zakat, but, unlike the laws of some other Muslim countries, it does not make zakat payments obligatory.55 It is up to Indonesian Muslims whether to perform zakat or not.

Why did the state take a “neutral” position with regard to the scope and the obligatory nature of zakat? Three possibilities come to mind.

First, cognizant of its “secular” stance, perhaps the state wanted to avoid getting involved in defining religious tenets, such as the details of zakat, and enforcing them. Although this neutral stance might lead to legal uncertainties when zakat payers object to a new interpretation of zakatable items, such as incomes of contemporary occupations and services, controversy might be minimal because the state does not make zakat obligatory. This explanation seems unsatisfactory, though. The state has written religious tenets into positive law long before Law No. 38/1999, including the 1991 Compilation of Islamic Law that addressed such topics as marriage and inheritance. Furthermore, in light of the state’s efforts to mobilize zakat funds through its governmental BAZ, such a neutral stance ultimately seems counterproductive and self-contradictory.

Second, the state may have expected details of zakat implementation to be worked out through lower-level entities and their decrees, such as the Minister of Religion’s Decisions. But MRD No. 581/1999 falls short in this regard. It provides details about the organizational structures of the semi-governmental zakat collector bodies (BAZ) and their roles according to their competencies – national or local levels (provinces, districts, and sub-districts)56 – while also addressing the requirements for nongovernmental zakat collector institutions (LAZ) to get official status and the requirements for utilizing zakat proceeds.57 But it does not elaborate on the specific religious rules applicable to zakat.

Finally, perhaps timing played a key role. The state simply may not have been ready to introduce a full-scale program for zakat management. This might have been caused by the nation’s troubles during the transition process, which compelled the government to concentrate on more pressing matters such as political stability and security and the devaluation of home currency.

Whatever their cause, the weaknesses in Law No. 38/1999 fuel continuing debates over the state’s role in managing zakat.

3. Recent Debates Over the Law of Zakat Management

a. Conflict of Law in Terms of Tax Deductions

A conflict of law initially occurred because of disharmony between the Zakat Management Law, Law No. 38/1999, and Law No. 17/2000 (amending Law No. 7/1983 on Income Tax). On the one hand, Law No. 38/1999 states that zakat paid to BAZ or LAZ can be deducted from the taxable profit or income of a taxpayer according to current tax regulation.58 On the other hand, Law No. 17/2000, the current tax regulation, does not include zakat among the listed deductions. Instead, this Law indicates that zakat collected by BAZ or LAZ cannot be counted as a deduction in determining the amount of income subject to tax.59

This conflict has been partly solved through issuance of Tax Decision No. KEP-163/PJ/2003 by the Director General of Tax. Article 1 sections 1 and 3 of the Decision state that zakat paid to BAZ or official LAZ may be subtracted from the gross income of a taxpaying legal body or from the net income of a personal taxpayer up to2.5%.60 But this deduction is limited to income subject to both zakat and income tax. Because the category of zakatable items is broader than the items subject to income tax,61 some zakat, such as that on wealth, will not be deductible.

b. The Need for a Self-Regulatory Organization

Law No 38/1999 provided some legal basis for zakat management and its institution in Indonesia. It is insufficient, however, without an organizational, accountability-enforcing structure as well. The adoption of such a structure is indispensable, especially because Law No. 38/1999 and MRD No. 581/1999 do not adequately provide for a body to supervise and regulate the nongovernmental LAZ. Both the Law and the MRD focus more on the structure and the organization of the BAZ.62 As a consequence, conflicts of interest or overlapping programs can occur among LAZ.63

In hopes of partially remedying the problem, some nongovernmental zakat collector institutions have joined together to form the Committee on Zakat for Humanity.64 The Committee has limited functions, however. It enables members to share ideas and experiences, but it lacks the power to enforce regulations because its roles are merely coordinative, consultative, and informative.65

Perhaps the National Zakat Collector Body (BAZNAS) – the highest body in the organizational structure of the semi-governmental zakat collectors – could play a role as the organizational umbrella for both BAZ and LAZ. BAZNAS is the only collector body established by Presidential Decision,66 which gives it additional authority. Moreover, the vast expertise of BAZNAS personnel67 shows that this body can effectively address issues of self-regulation, such as codes of ethics, evaluative mechanisms, and disciplinary mechanisms.68 In practical terms, however, BAZNAS is experiencing difficulties in performing a self-regulatory function, because the state also assigns it the micro-level role of collecting and distributing zakat.69 According to Eri Sudewo, an expert in zakat management, for BAZNAS to provide an effective organizational umbrella, it should work only at the macro level, as the policymaker and supervisor.70

In the rapid development of voluntary sector organizations, state regulations can fall behind. In particular, regulations sometimes neglect the importance of nongovernmental organizations as partners in community development. So we see in zakat management, where regulations have proved somewhat inadequate with regard to nongovernmental collectors. The existence of self-regulatory mechanisms is ultimately vital for the management of zakat. Such mechanisms can be created, one hopes, when the problem reaches the agenda of all zakat players in Indonesia.

D. Conclusion

Recent developments indicate that the state has tried to alter its attitude toward the existence of zakat in Indonesia. Since 1999, the management of zakat has held firm legal status through the Law of Zakat Management No. 38/1999. Further, this Law has been endorsed and implemented in part by the Minister of Religion’s Decision No. 581/1999 and by change of the taxation regime. Because the above regulations concentrate mainly on the semi-governmental zakat collector bodies, however, the nongovernmental zakat collectors continue to face obstacles in performing their functions.

Regulations that better facilitate the nongovernmental zakat institutions would maximize the mobilization of zakat funds and their immediate redistributive economic impact in Indonesia. The nongovernmental zakat institutions have the same potential for generating zakat funds as the semi-governmental collector bodies do.71 The only hurdle is a lack of professional management and oversight on the part of the nongovernmental collectors. And this can be remedied if the facilitative rule of law becomes a greater part of zakat management in Indonesia.

 

1 Junior lecturer at the State Institute for Islamic Studies (STAIN), Samarinda, Indonesia, and LLM Candidate, University of Melbourne. A full version of this article was submitted as part of coursework undertaken for an LLM in the Faculty of Law, University of Melbourne. I am very grateful to Professor Mark Sidel for his comments on the full version of this article; and, for correcting my English errors, to Ms. Cheryl Baker (Language Assistant, University of Melbourne) and Andrew White, Esq., and Mr. Alan Manna (both LLM Candidates, University of Melbourne).

2 Al-Qaradawi, Fiqh az-Zakah (24th ed., Beirut : Mu`assasat al-Risalah, 1997), 37-38; Abdullah Ibn Muhammad ath-Thayyar, az-Zakah wa Tatbiqatuha al-Mu’asirah (2nd ed, al-Riyad: Maktabat al-Tawbah, 1993), 12.

3 Mohammed Ariff, “Introduction,” in Mohamed Ariff (ed.), Islam and the Economic Development of Southeast Asia: The Islamic Voluntary Sector in Southeast Asia( Singapore: Institute of Southeast Asian Studies , 1991), 2.

4 Taufik Abdullah, “Zakat Collection and Distribution in Indonesia,” in Ariff (ed.), Islam and Economic Development, 50-84.

5 See Bahtiar Effendy, Islam and the State in Indonesia( Singapore: Institute of Southeast Asian Studies, 2003), 164-165.

6 See Ariff, “Introduction,” 2.

7 See al-Qaradawi, Fiqh, 917; Muhammad Nejatullah Siddiqi, “The Role of the Voluntary Sector in Islam: A Conceptual Framework,” in Ariff (ed.), Islam and Economic Development, 17-18; Mohamed Ariff, “Resource Mobilization through the Islamic Voluntary Sector in Southeast Asia,” in Ariff (ed.), Islam and Economic Development, 39.

8 See Al-Qaradawi, Fiqh, 932; Siddiqi, “The Role,” 18; Ariff, ” Resource,” 39.

9 See al-Qaradawi, Fiqh, 924, 930; Siddiqi, “The Role,” 18.

10 A th-Thayyar, az-Zakah, 126; al-Qaradawi, Fiqh, 922.

11 See Monzer Kahf, The Principle of Socio-Economic Justice in the Contemporary Fiqh of Zakah, 6, at https://monzer.kahf.com/papers/english/socioeconomic%20justice.pdf (14 June 2005).

12 Monzer Kahf, Zakah, 3, at https://monzer.kahf.com/paper/english/zakah.pdf (14 June 2005).

13Ibid., 3-4.

14 Al-Qaradawi, Fiqh, 66.

15 Siddiqi, “The Role,” 21-22.

16 Kahf, Zakah, 8. According to Kahf, Yemen is the only Muslim country that has retained this task without interruption since the Prophet era. See ibid.

17 For more details about zakatable items, nisab, and zakat rates, see Al-Qaradawi, Fiqh, 121-533; Ath-Thayyar, az-Zakah, 77-101; Kahf, The Principle, 17-18; Kahf, Zakah, 3-4; Siddiqi, “The Role,” 15; Ariff, “Introduction,” 2; H. A. Jazuli and Yadi Janwari, Lembaga-Lembaga Perekonomian Umat (Sebuah Pengenalan) ( Jakarta: RajaGrafindo Persada, 2002), 41-45.

18 Other groups of beneficiaries are the poor (al-fuqara); the indigent (al-masakin); those whose hearts have been reconciled to the truth, such as new converts to Islam (al-mu`allaf); those in bondage (ar-riqab); debtors (al-gharimin); those in the cause of God (fi sabilillah); and wayfarers (ibn as-sabil). See al-Qur’an, chapter IX (at-Tawbah): 60; Ariff, “Introduction,” 2.

19 Kahf, Zakah , 5.

20 See Ariff, “Introduction,” 4.

21 See ibid. See also al-Qur’an, at-Tawbah (IX): 103.

22 See Al-Qaradawi, Fiqh , 979-980; Nakamura Mitsuo, “Introduction,” in Nakamura Mitsuo, Sharon Siddique, and Omar Farouk Bajunid (eds.), Islam and Civil Society in Southeast Asia ( Singapore: Institute of Southeast Asian Studies, 2001), 12; Siddiqi, “The Role,” 19; Ariff, “Introduction,” 4.

23 The term ‘zakatability’ is derivation from the term ‘zakatable’ which means items that are subject to zakat. It comes from two words ‘zakat’ and ‘able’ which mean having the condition of being subject to zakat. See Kahf, The Principle, 16

24 Raj Bhala, “Theological Categories for Special and Differential Treatment” (2001-2002) 50 University of Kansas Law Review 689.

25 Ibid.

26 See Kurniawati, (ed), Kedermawanan Kaum Muslimin: Potensi dan Realita Zakat Masyarakat di Indonesia Hasil Survei di Sepuluh Kota( Jakarta: Piramedia, 2004), 5.

27 See Deliar Noer, Administration of Islam in Indonesia (Ithaca, NY: Cornell Modern Indonesia Project, Southeast Asia Program, Cornell University, 1978), 8.

28 See Noer, Administration, 18; C. A. O. Van Nieuwenhuijze, Aspects of Islam in Post-Colonial Indonesia ( The Hague: W. van Hoeve, 1958), 222-223.

29 See Noer, Administration, 20. Compare to the current organizational structure of the Ministry of Religion, which includes the Directorate of Zakat Development. See https://humasdepag.or.id/struktur.php (12 June 2005).

30 Robert W. Hefner, Civil Islam: Muslims and Democratization in Indonesia ( Princeton, NJ: Princeton University Press, 2000), 59.

31 See Abdullah, “Zakat Collection,” 51.

32 See Ariff, “Resource,” 33.

33 Abdullah, “Zakat Collection,” 51, 80.

34 See M. Dawam Raharjo, Perspektif Deklarasi Makkah: Menuju Ekonomi Islam (Bandung: Mizan: 1987), 190-197.

35 Ariff, “Resource,” 34; Raharjo, Perspektif, 189.

36 Ariff, “Resource,” 34; Raharjo, Perspektif, 189.

37 Ariff, “Resource,” 34; Raharjo, Perspektif, 189.

38 Abdullah, “Zakat Collection,” 55.

39 Ariff, “Resource,” 33; Abdullah, “Zakat Collection,” 54.

40 SKB No. 29 year 1991/No. 47 year 1991.

41 Surat Keputusan Bersama Menteri Agama dan Menteri Dalam Negeri No. 29 year 1991/No. 47 year 1991, article 1.

42 See Jazuli, Lembaga, 39-40.

43 Effendy, Islam, 164, 166.

44 Mark Sidel and Iftekhar Zaman, “Philanthrophy and Law in South Asia: Key Themes and Key Choices” in Mark Sidel and Iftekhar Zaman (eds.), Philanthrophy and Law in South Asia ( San Francisco and Manila: Asia Pacific Philanthropy Consortium, 2004), 22.

45 Rustam Ibrahim, Abdi Suryaningati, and Tom Malik, ” Indonesia,” APPC Conference (September 5-7, 2003), 138.

46 Ibid.

47 Effendy, Islam, 200.

48 Ibid.

49 Ibid.

50 See ibid., 209-210, 217-218.

51 See Undang-Undang No. 38/1999, articles 6, 7, 18 (s 4), 19, 20.

52 See ibid., articles 6 (s 1), 7; Keputusan Menteri Agama No. 581/1999, article 1 (s 1-2).

53 Undang-Undang No. 38/1999, article 8.

54 Ibid., article 11 (s 1-3).

55 See Kahf, Zakat, 8-11.

56 Keputusan Menteri Agama No. 581/1999, articles 2-20.

57 Ibid., articles 21-24.

58 Undang-Undang No. 38/1999, article 14 (s 3).

59 Undang-Undang No. 7/2000, articles 4 (s 3), 9 (s 1).

60 Keputusan Direktur Jenderal Pajak Nomor KEP-163/PJ/2003 tentang Perlakuan Zakat Atas Penghasilan Dalam Penghitungan Penghasilan Kena Pajak Pajak Penghasilan, article 1 (s 1 and 3).

61 Compare Undang-Undang No. 38/1999, article 11 (s 2), and Undang-Undang No. 7/2000.

62 See Undang-Undang No. 38/1999, article 6; Kep. Menag No. 581/1999, articles 2-20.

63 Republika Online, Mereposisi Peran BAZNAS, at https://www.republika.co.id/Cetak_detail.asp?id=139514&kat_id=105 (28 April 2005).

64 See Asia Pacific Philanthropy Consortium, Strengthening Philanthropy in the Asia Pacific: An Agenda for Action – Background Paper: Indonesia (July 2001), 14-15.

65 Republika Online, Mereposisi (July 2001).

66 See Keputusan Presiden Republik Indonesia No. 8/2001, consideration b (b).

67 See Lampiran Keputusan Presiden Republik Indonesia No. 8/2001 of the January 2001–December 2003 List of BAZNAS membership.

68 See Mark Sidel, “Trends in Nonprofit Self-Regulation in the Asia Pacific Region,” in Asia Pacific Philanthropy Consortium (2003), 1-2.

69 See Keputusan Presiden Republik Indonesia No. 8/2001, articles 1, 4, 6; Republika Online, Mereposisi (July 2001).

70 Republika Online, Mereposisi (July 2001).

71 An example is Yayasan Dompet Dhuafa. Founded in 1994, Dompet Dhuafa after five years surpassed the fundraising (zakat, infaq, sadaqah, and waqf) of BAZ Jakarta, which has operated since 1968 and become one established zakat collector in Indonesia. See Asia Pacific Philanthropy Consortium, Strengthening, 14. Not only innovative in fundraising, Dompet Dhuafa (https://www.dompetdhuafa.org) has established enormous community-oriented programs in distributing and utilizing zakat and other charity funds in Indonesia.