Cape Town - Steps to deal with decaying inner-city areas in 14 urban centres around the country through a R1.3 billion, four-year tax depreciation scheme were announced in the budget yesterday.

Further tax benefits would also be provided to public-benefit organisations that provided affordable housing schemes to low-income households in underdeveloped urban areas.

The Budget Review said the scheme would be allocated about R60 million in forgone tax revenue in 2002/03. This would rise to about R400 million a year after that, after which the programme would be wound up.

It said that in line with many other countries, South Africa had a number of poor urban areas that suffered from extensive decay. To maintain the existing infrastructure, which had been developed at great cost, governments around the world were increasingly using tax measures to help regenerate these areas.

Under the scheme, investors in these urban areas would receive special allowances for investment undertaking to build or refurbish buildings.

They would receive a 20 percent straight-line depreciation allowance over a five-year period. If they built a new commercial or residential building in one of the designated areas, they would receive a 17-year write-off period with a 20 percent write-off in the first year and a 5 percent write-off thereafter.

The benefit would be available to owners who used the buildings or who acted as lessors/financiers for the buildings.

Priority would be given to areas with a high capacity for population, central business districts or inner-city areas, and areas with developed urban transport infrastructure for trains, buses or taxis.