THE Urban Development Corporation (UDC) on Wednesday launched its Tax Incentive Programme for Urban Renewal at Emancipation Square in Spanish Town, St Catherine — a move that Government is hoping will pull more investors into the old capital.

The aim of the programme, which was launched in downtown Kingston, Port Royal and Montego Bay years ago, is to restore blighted areas and re-inject life into derelict towns.

It offers tax breaks in the form of tax-free interest on urban renewal bonds, a 25 per cent tax credit on capital sums, relief from income tax on rental or lease income, and exemption from transfer tax to property owners and legal tenants who refurbish property within special development areas.

“So attractive are these benefits, especially in these trying times, that they can make the difference between solvency and insolvency in businesses by giving participants that elusive competitive advantage,” said UDC general manager Joy Douglas.

To date, only one company — GraceKennedy — has taken advantage of TIP in Spanish Town since the programme became operational there two years ago. In March this year, the food processing giant built a US$280-million, 230,000 sq ft distribution centre on the Bernard Lodge Estate.

“The construction of this state-of-the-art distribution centre been the largest single investment undertaken by the company in recent time and it might not have become a reality without the support offered through the Tax Incentive Programme,” said Andrea Coy, general manager, World Brand Services at GraceKennedy.

“In fact, we had been exploring the idea of a specialised distribution centre for some time and acquired the land over 20 years ago with this project in mind. However, the incentives offered under the TIP gave us the breathing space to make the US$28 million investment,” she added.

And already, Coy said, the company has begun to reap the rewards of its decision.

“By being able to house all our various distribution companies under one roof, we have been able to consolidate our warehousing and shipping, resulting in savings in transportation costs and greater responsiveness to our customers,” Coy said.

Prime Minister Bruce Golding, who delivered the main address at Wednesday’s launch, said though urban renewal has been a much-talked about issue, the difference now is that there will be less public sector influence and more private sector involvement.

“We’ve been talking about the re-development of Spanish Town for as long as I can remember,” he said.

Describing the city as a “gold mine” with “enormous economic potential”, Golding called on the private sector to get on board, saying government would be unable to shoulder it given all its other responsibilities.

For her part too, Coy also urged private sector bodies to follow GraceKennedy’s example and take advantage of TIP, “both for the benefit of their business and the opportunity to participate in the re-development of Spanish Town”.

Member of Parliament for St Catherine Central Olivia Grange and Spanish Town Mayor Dr Andrew Wheatley also addressed the gathering