Integrating Zakat into Fiscal Policy: A Conceptual Framework for Ethical Redistribution and Poverty Alleviation

Abstract

This study presents a comprehensive conceptual framework for integrating zakat, the Islamic wealth redistribution obligation, into national fiscal policy. Drawing from Islamic jurisprudence and contemporary public finance theory, the paper argues that zakat is not only compatible with modern fiscal principles but also enriches them with ethical and cultural legitimacy. Through a normative, document-based approach, the research identifies legal, institutional, and technological mechanisms that enable zakat’s effective integration into state governance. Key findings demonstrate that zakat, when centralized and embedded within fiscal structures, enhances income redistribution, supports economic empowerment, and fosters institutional trust. By aligning the spiritual mandate of zakat with state-administered welfare systems, the study offers a model that balances religious duty with fiscal efficiency. The analysis provides practical policy insights for Muslim-majority countries seeking to address poverty through culturally coherent and ethically grounded strategies. It concludes by recommending codified legislation, digitized administration, and fiscal harmonization to maximize the potential of zakat as a public finance tool.