INTRODUCTION

Zakat is one of the five pillars of Islam relating to wealth and welfare of the society. It is the
third pillar of Islam and it is also act as Fardhu Ain. Therefore, zakat means purification and
growth. For example, an individual wealth and possessions are purified by setting aside a
proportion for those in needs. So, its means by giving zakat is purifying ones wealth to gain
Allah blessing to make it grow in goodness. According to Chapra (1992), Zakat is also
recognized as a self-help measure adopted with full religious backing, to support those poor
and destitute who are unable to help themselves and alleviate misery and poverty from the
Muslim society. Furthermore, there are two types of zakat in Islam which is zakat fitrah
(zakat al-fitr) and zakat on wealth (zakat al-mal). Besides that, zakat is also known as a
financial and economic tool to cleanse ones wealth.
The history Zakat Institution in Malaysia, Kelantan was the first state to establish the
body and became a model to other Malay Sates. On that date, Imam has been empowered to
govern zakat related matters and a portion of zakat collection would be delivered to the state
government as a financial resource for Islamic affairs. Now, there are four different forms of
zakat corporations in dealing with the collection and distribution of zakat in Malaysia. First,
corporation established under zakat enactment such as Jabatan Zakat Negeri Kedah and
TabungBaitulmal Sarawak. Second, corporation established under the state administration of
Islamic law enactment such as Lembaga Zakat Selangor and PusatUrus Zakat Pulau Pinang
(PUZ). Third, corporation established under an Act or State administration of Islamic law
enactment with a duty to collect zakat only such as PPZ MAIWP (HartaSuciSdnBhd), PZM
MAIM (Pusat Zakat Melaka SdnBhd), PZNS MAINS (Pusat Zakat Negeri Sembilan
SdnBhd) and PKZ MAIP (PusatKutipan Zakat Pahang SdnBhd). Lastly, collection and
distribution of zakat is executed by MAIN through its own unit or department of Baitulmal or
zakat centres such as Majlis Agama Islam Johor, Majlis Agama Islam Perlis, Majlis Agama
Islam danAdatMelayu Perak, Majlis Agama Islam danAdatIstiadatMelayu Kelantan, Majlis
Agama Islam danAdatIstiadatMelayu Terengganu and MajlisUgama Islam Sabah.

ISSUE IN COLLECTION OF ZAKAT IN MALAYSIA

There are a few issues arising in collection of zakat in Malaysia. The first issue in
collection of zakat is negative perception on zakat management. The zakat payers were not
satisfied with zakat management in aspect of zakat distribution. Majority of zakat payers in
Malaysia felt the process of distribution and information regarding zakat distribution was
unclear. They were of the view that zakat institutions should convince the public that the fund
collected were not only distributed in accordance with sharia but also administered
professionally and efficiently. According to Utusan Malaysia (2014) stated that Zakat
distribution mechanisms in Malaysia are still failing to overcome problem of poverty among
Muslims even though the number of zakat collection of zakat collection centres reported
increased every year. From this news, it will make the zakat payer dispute where the zakat
fund was distribute. If these problems not resolve immediately by zakat management, it will
make the growing dissatisfaction amongst the zakat payers might prompt them to pay through
unofficial channels. In other words, there is a possibility that the zakat payer would pay zakat
directly to the zakat recipients.
The next issue in collection of zakat is the shortage of staff and experts in the zakat
institutions relative to the numerous tasks under their responsibility. By that problem, it could
lead to inefficiency and ineffectiveness of performance of zakat institutions. The lack of
management expertise, lack of commitment, lack of information and legalities in zakat
administration could give rise to dissatisfaction among the society and give impact to the
reputation which make zakat payer not confident with zakat institutions in Malaysia. Thus,
the zakat institutions need to improve their governance in zakat management. As a result any
problems happened in zakat management such as illegal sale of application forms to zakat
recipients by the amils can be rectified through proper regulation and spiritual training and
these tasks could efficiently been done through localization of zakat management. At the
same time, it will revive confidence of zakat institutions.
The third issue is the transformation in the administration of zakat could be done by
improving the ability of zakat collection centres to identify not only those who should pay
zakat, but also to trace down the prospective zakat payers. For this purpose, the authority
needs to change the method of collecting zakat from waiting at the counters to proactively
organising briefing sessions on the importance of zakat to students, to public and private
sector workers, and to police and soldiers in training. This initiative may raise awareness
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among prospective payers to fulfil their religious obligations in the future. Because from the
report by PPZ/MAIWP in 2010, the number of Muslims who live in Selangor is
approximately 2 million, the number of zakat payers is only around 160,000. That is critical
number that Muslim are not have awareness to their responsible.
Next issue are law enforcement on tax is more powerful compared to zakat, it must be
other factors that lead to zakat payment. From the collection of tax in Malaysia, we are
known that business taxes are the main component for our countrys tax income. However, it
is not aligned with the zakat on business collection. As an example in year 2004, Lembaga
Hasil Dalam Negeri (LHDN) reported tax from businesses contributed more than 50% from
the total tax amount collected. The result is contradicted with the report from Pusat Pungutan
Zakat, Majlis Agama Islam Wilayah Persekutuan (PPZMAIWP) in 2008. In Wilayah
Persekutuan, collection from zakat on Income is 3 times or 381% more compared to
collection of zakat on business. Abdul Rahim, 2005 says, this should not happen as we know
that zakat on Business have more potential of collection and commandment for zakat on
Business comes directly from al Quran compared with Zakat on Income that based on fatwa.
From the research by Nik Mustapha Bin Hj. Nik Hassan, he was conclude about hte
collection of zakat in Malaysia is not very impressive and encourage. He also give the reason.
One of the reason is public ignorance as to the concept and position of zakat from Islamic
point of view. Another reason is the administrative inadequacy and inefficiency. Next are
reasons is zakat coverage and independent payment of zakat.

CONCLUSION
In conclusion, Zakats role in an Islamic economic system cannot be overlooked or ignore as
it is one of the five pillars of Islam. From the religious point of view the failure to implement
it in its comprehensive whole is a serious omission which tantamount to an act of
disobedience to Allah. Islam viewed business activities as important but considers necessary
for the company to contribute back to the society in terms of zakat. According to Abdul
Rahman (2003), The Company that pays zakat on business wealth indicates their commitment
to promote social justice and fulfill its social accountability to Allah. In Malaysia although
the law does not require companies to pay zakat, zakat collection business is increasing every
year. During the Prophet Muhammad, there is no issue about the legal entity separate because
at that time the economic situation is not as complicated as in the present and what is
important is what we have now is not based on Al-Quran and As-Sunna. Zakat system as
implemented in Malaysia at the moment is far from perfect and in tune with the aspirations of
Islam. However, the current scenario in Malaysia shows that zakat collection business is still
poor. Collection of zakat on income is usually more than the collection of zakat in any
administrators zakat in Malaysia.
Collection of zakat in Malaysia to increase is attributed to various factors, particularly the
ongoing propaganda efforts and the management of zakat (PPZ) visits have been doing their
job well, but should find new ways to expand the knowledge and disseminate it to the public.
In addition, the cooperation of other bodies and agencies should also be created and trained
together so that the objectives of Sharia and Islam must be carried out remains intact in our
country. Therefore I suggest that the management of zakat (PPZ) making propaganda
campaign to the general public through mass media, through newspapers, magazines, radio or
even advertisements on television to promote the duty of zakat. Briefing charity and opening
branch counters can also increase the amount of zakat collection. According to Rais Alias
(2004) Quote zakat locally based groups or parish is one way in which PPZ open service
counters while at the offices of the government or a private company offices. This method
was introduced with the objective to help those who have not had the opportunity to PPZ
office due to barriers such as time, work and so on. It is also only local people know best the
needs and problems of recipients into place. In the existing system, officers or unconsciously
amil zakat collected leads to another while the original inhabitants need it. As such we
encourage the authorities to restore the obligatory zakat quoted residents in advance before
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being taken to other places such as the practice of charity which is done during the time of
Khalifah Umar Abdul Aziz. The excess zakat of a parish that was taken out to be channeled to
areas experiencing a deficit in the distribution of zakat due to the number of recipients of
zakat overcome existing revenue. Indirectly zakat money distributed to kariah or area or
other states would reduce the economic gap Muslims all over the country.

REFERENCES
Hairunnizam Wahid. (2014), Localization Of Malaysian Zakat Distribution: Perceptions Of
Amils And Zakat Recipients, Faculty Of Economics And Administration University Of
Malaya, Kuala Lumpur
Mohammad Haji Alias and Syed Mohd Najib Syed Omar. (June 2012), Zakat Institution In
Malaysia: Problems And Issues
Nik Mustapha Bin Hj. Nik Hassan. (August September 1987), Zakat in Malaysia-Present
and Future Status, Journal of Islamic Economics