Irish builders yesterday called on the Government to abolish the tax relief deadline for projects already in the planning process, and to specifically target areas like arts centres, leisure centres and health care buildings in a revamped tax incentive scheme for property development.

The schemes in cities, towns and villages were an obvious framework to "balanced regional development", they said.

They were due to end in July 2006 and the Department of Finance is currently reviewing all tax exemptions and reliefs for property development, home builders heard at their annual conference.

However, Construction Industry Federation representatives meeting in Killarney at the Irish Home Builders Association this weekend, warned "the baby should not be thrown out with the bath water".

Tax incentive schemes had worked well in the regeneration of rural and urban Ireland said Martin Whelan, eastern regional president of the Construction Industry Federation.

The controversy surrounding tax-incentive-driven holiday homes was in danger of clouding the issue as a whole but tax incentive schemes were not just for holiday homes, Mr Whelan said.

Some of the most blighted areas of cities, towns and villages had benefited enormously.

Whole areas of under-utilised, and derelict parts of inner-city Dublin such as Temple Bar and the Docklands and, more recently, Ballymun had been transformed. Outside Dublin, some €500 million had been invested in Limerick city and almost 80 per cent of designated sites redeveloped with the help of tax incentives since the introduction of the urban renewal scheme in 1999.

However, some 40 per cent of projects under the scheme were still at planning stage and would be unlikely to meet the July 2006 cut off point.

"We are saying to Government and the Department of Finance: abolish the timescale. Let us acknowledge schemes that have served their purpose and focus on the type of areas where investment is needed," Mr Whelan said.

Health, education, arts, sport and leisure projects were all areas that could be developed with incentives. Over 1,000 projects worth €5.8 billion were targeted in the urban renewal scheme to June of last year.

The urban scheme and those for town and village renewals were "in parts of the country where investment is urgently needed and unlikely without taxation incentives", Mr Whelan said.