Business zakat compliance behaviour in Algeria and its determinants

Throughout Islamic history, zakat has eradicated poverty. However, several Islamic nations, including Algeria, still experience high rates of poverty alongside modest zakat collection statistics. In Algeria, neither the amount of zakat collected from zakat payers nor the level of compliance among business owners is satisfactory. Thus, this study aims to investigate the determinants of business zakat compliance behaviour among Algerian business owners. The research framework of this study incorporated Social Cognitive Theory into the Theory of Planned Behaviour as well as examining the effect of political instability and the moderating effect of knowledge as Algeria faces an unstable political environment. The study utilized a survey questionnaire of 575 active business owners from seven Algerian governorates, out of which 344 were suitable for analysis. The hypotheses were tested using the Partial Least Square-Structural Equation Modeling (PLS-SEM). The findings indicated that attitude, subjective norms, perceived behavioural control, religiosity, past behaviour, and political instability had a significant direct influence on intention, as well as a mediation influence of intention on zakat compliance. Additionally, the findings indicated that knowledge moderated the relationship between attitude and political instability with zakat intention. Overall, the novelty of this study is a pioneer in providing empirical evidence to the scanty literature, especially on the applicability of the Social Cognitive Theory and the Theory of Planned Behaviour in zakat field, as a viable framework for a better understanding of zakat compliance. The findings are crucial for policymaking by the zakat authority, government and future researchers’ efforts to comprehend the zakat compliance behaviour of business owners.