KINGSTON, Jamaica – Prime Minister Dr. Andrew Holness, speaking during the 2026/27 Budget Debate, announced a significant overhaul of Jamaica's urban renewal strategy, introducing a new framework designed to incentivize the restoration of dilapidated properties across the island. This initiative aims to unlock the economic potential of blighted urban areas, particularly in downtown Kingston, Spanish Town, and Montego Bay, which have long been characterized by vacant lots and derelict buildings.
The core of the new framework is an expansion of tax credits for individuals and entities undertaking urban renewal projects. Developers will now be able to apply existing tax credits against up to 100% of their income tax liability, a substantial increase from the previous 50% limit. This enhanced incentive seeks to make such investments more financially attractive and viable.
Furthermore, for projects deemed to be of high priority, the tax credit will see an even greater boost. Developments in severely blighted areas, affordable housing initiatives, and critical public facilities will qualify for a credit increase from 33.3% to 40%. This targeted approach underscores the government's commitment to addressing pressing social and infrastructural needs while revitalizing urban centers.
Prime Minister Holness highlighted the historical context of urban renewal efforts in Jamaica, noting the limited success of the Urban Renewal Tax Relief Act, which has been in place since 1995. Over nearly three decades, only 56 projects were approved under the previous legislation, a figure Holness described as indicative of a framework that was not truly fit for purpose. He emphasized that despite the clear potential of these urban spaces – their proximity to infrastructure, jobs, and services – the right mechanism to unlock this value has been absent until now.
“Any serious conversation about land use, productivity, and housing must confront one of Jamaica’s most visible failures in land utilisation — our blighted urban spaces,” Holness stated, underscoring the urgency and importance of the new approach. He had previously indicated his intention to overhaul the existing framework, and the current announcement fulfills that commitment, signaling a renewed push to transform these underutilized assets into engines of economic growth and community development. The government anticipates that these strengthened incentives will spur a significant increase in private sector investment in urban renewal, leading to a more vibrant and productive urban landscape across Jamaica.
