Abstract

This study demonstrates literately the importance of regional (urban-rural) differences and the impact of zakatdistribution towards the poverty alleviations among asnaf Muallaf. This study was motivated by the monthlyofficial zakat distribution towards asnaf Muallaf that did not differentiate the true urban-rural cost of livingdifferences. Differences in urban and rural poverty lines that did not reflect the actual urban-rural cost of livingdifferences will provide a misleading picture of the distributional impact of development, which usually involvesurban sector expansion. In a dualistic economy, one of the ways the poor benefit from development is throughexpansion of job opportunities in the modern predominantly urban sector, in addition to increases in productivityin the traditional predominantly rural sector. Thus, this study aims to identify the dispersal of Muallaf in terms ofurban-rural poverty that involved in allocation of zakat distribution. In defining poverty between urban and ruralareas, therefore, one should ensure the differences in the cost of living between these two areas. The findingsuggest that, a huge of amount of zakat been allocated to the development of asnaf Muallaf in the state ofSelangor especially in urban area. However, most of zakat distribution on Muallaf goes to urban region whichhigher in cost of living without considering a set of prices including a broader bundle of goods and servicesrepresentative of the purchases of consumers in different region.

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