Corporate Financial Management in Facing Tax Changes

 

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🕌 Core Instruments of Islamic Social Finance

1. Zakat (Obligatory Almsgiving)
   Zakat is a mandatory charitable contribution for eligible Muslims, designed to redistribute wealth and support the needy. In Indonesia, for instance, zakat funds have been utilized to finance renewable energy projects, such as a micro-hydro power plant in Jambi province, benefiting nearly 5,000 individuals .

2. Waqf (Endowment)
   Waqf involves donating assets or wealth for perpetual charitable purposes. Modern applications include funding educational institutions, healthcare facilities, and infrastructure projects. In Khyber Pakhtunkhwa, Pakistan, waqf-led initiatives have significantly contributed to poverty alleviation and community development .

3. Sadaqah (Voluntary Charity)
   Sadaqah refers to voluntary charitable giving, often used for immediate relief in humanitarian crises. It enables swift responses to emergencies, providing essential aid such as food, shelter, and medical assistance .

4. Qard al-Hasan (Interest-Free Loans)
   These are benevolent loans extended without interest, aimed at supporting individuals in need. Organizations like Akhuwat in Pakistan have disbursed over PKR 200 billion in interest-free loans to more than 4.5 million families, fostering entrepreneurship and reducing poverty .

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🌱 Innovative Applications and Impact

• Zakat-Based Urban Farming: .

• Integration with Sustainable Development Goals (SDGs): .

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📊 Challenges and Recommendations

Despite their potential, Islamic social funds face challenges such as:

• Limited Awareness: .

• Inefficient Management: .

Recommendations:

• Enhance Financial Literacy:

• Strengthen Institutional Frameworks:

• Leverage Technology:

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