WESTERN BUREAU – Nearly four years after the government launched its Tax Incentive Programme (TIP) in Montego Bay to stimulate growth by providing tax breaks to developers, only two persons have applied for benefits under the initiative.

Urban Development Corporation (UDC) general manager, Marjorie Campbell, said the response to the July 2000 programme had not been encouraging.

“To date we have received only two applications, one of which has been approved. The other has been recommended by the steering committee to be approved by the ministry of finance,” Campbell told Thursday’s monthly meeting of the St James Parish Council.

The TIP is one of several strategies developed, over the years, to facilitate urban renewal. It offers incentives to those who invest in the development, rehabilitation or refurbishing of lands in locations declared special development areas.

Under the programme, government offers tax relief as an incentive to individuals and companies that undertake capital investment in the designated zones.

In Montego Bay, the declared development area is bordered on the west by the Waterfront, while in the south it is bordered by the Montego Bay River. In the East, it goes behind Jarrett Park up to the North Gully Road and then northerly along the Gully to the round-about.

The programme allows developers to get a 25 per cent tax credit, tax-free rental income, and the use of bonds which allows for lower financing costs for investment capital. But since its inception in the resort city, Kamili Associates – which built the $50 million Trinity Mall along Barnett Street in 2001 – has been the only beneficiary.

However Campbell said, Thursday, that despite the lukewarm response to the programme, the UDC would continue to encourage eligible persons and companies to make use of the incentives.

“We will continue to meet with several groups and send out letters to registered land owners within the designated special development areas,” she told the meeting.

She has also urged the council to use its influence to encourage businessmen to buy into the programme.

“The parish council has an important part to play in the process, since planning and building approval by the council is a requirement for access to the benefits under the TIP,” she maintained.

She told the Observer that the UDC had yet to determine why the Montego Bay business community has not bought into the programme.

“We still cannot understand why it is not being utilised in the way the UDC has expected it,” she said. “Maybe some persons are saying that the process is time-consuming or I don’t know if it is because persons have to file their income tax on time in order to benefit from the programme.”

Winston Dear, president of the Montego Bay Chamber of Commerce and Industry, suggested that businessmen in the resort city had not bought into the programme because of the bureaucratic red tape involved.

“It’s a very tedious process and very complicated to gain access to it. The incentives are not just given out like that,” he told the Observer.

He added that his organisation was willing to have discussions with the UDC to see how best the programme could be modified to suit local businessmen.