Malaysia legislation
Article 109
Article 109
Grants to States
(1)
The Federation shall make to each State in respect of each financial year—
(a)
a grant, to be known as a capitation grant, which shall be calculated in accordance with the provisions of
Part I of the Tenth Schedule;
(b)
a grant for the maintenance of State roads, to be known as the State road grant, which shall be calculated in accordance with the provisions of Part II of that
Schedule.
(2)
Parliament may from time to time by law vary the rates of the capitation grant; but if the effect of any such law is to reduce the grant, provision shall be made in that law for securing that the amount of grant received by any State in respect of any financial year is not less than ninety per cent of the amount received by that State in the preceding financial year.
(3)
Parliament may by law make grants for specific purposes to any of the States on such terms and conditions as may be provided by any such law.
(4)
The amounts required for making the grants mentioned in the preceding provisions of this Article shall be charged on the
Consolidated Fund.
(5)
If, in accordance with Article 103, a Contingencies Fund is created, the power to make advances from that Fund for meeting an urgent and unforeseen need for expenditure shall include power to make such advances to a State for meeting such a need.
(6)
The Federation shall pay into a fund, to be known as the
State Reserve Fund—
(a)
(Repealed);
(b)
in respect of every financial year such sum as the Federal
Government may, after consultation with the National
Finance Council, determine to be necessary,
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[Article 108]
Federal Constitution
Art. 109
Clause (2): See Art. 108(4)(g).
Clause (6)
The word “succeeding” which appeared before the words “financial year” in paragraph (b)
was deleted and paragraph (a) were repealed by Act 25/1963, section 8, in force from 29-08-1963 and read as follows:
“(a) in respect of the first financial year in which Part VII is in operation, the sum of four million dollars; and”.
Federal Constitution and the Federation may from time to time, after consultation with the
National Finance Council, make grants out of the State Reserve Fund to any State for the purposes of development or generally to supplement its revenues.