During his 2008 Budget speech, the Minister of Finance, Trevor
Manuel, announced that the Urban Renewal Tax Incentive that was
introduced in 2004, will be extended for another five years until
March 2014. This news was celebrated by investors hoping to benefit
out of South Africa hosting the 2010 FIFA World Cup.
The tax incentive takes the form of an accelerated depreciation
allowance in 16 designated Urban Development Zones (UDZ). The
intention of the incentive is to address inner city decay caused by
urban migration, and to ensure that existing infrastructure in
these areas is maintained and utilised to its full capacity.
Central business districts and inner cities typically have
well-developed transport infrastructure and population carrying
capacity. The South African government's objective is therefore
to promote private sector investment in residential and commercial
property; both through construction of new buildings and
improvement of existing ones. The
