Local authorities throughout the State could be prevented from introducing development levies after a lobby group secured an injunction against the scheme in Dublin City Council.

Labour and the Green Party said last night there was nothing to stop challenges against other local authorities after the High Court granted leave to appeal the scheme to the Construction Industry Federation (CIF).

The CIF said its concerns related to "the legality and the arbitrary nature" of the levies.

"There are also issues surrounding the consultation process and the lack of an appeals mechanism," it said.

"The proposed development levies discriminate against buyers of new properties by obliging them to pay for infrastructure and services enjoyed by the whole community," according to the CIF.

Fine Gael's environment spokesman, Mr Eamon Gilmore, called on the Minister for the Environment, Mr Cullen, to abandon the scheme in all local authorities after the CIF secured its injunction.

He said Mr Cullen had ignored numerous warnings about the charges and said the scheme was being used to introduce "major stealth taxes" locally.

The Government introduced Sections 48 and 49 of the Planning and Development Act 2000, to allow local authorities raise money by charging a fixed-amount levy on planning permissions.

Councils across the State have until early next year to adopt the scheme and many have already set a fixed rate, with Wicklow County Council and Fingal in Co Dublin charging the highest residential levies of up to almost €20,000 per home once VAT has been paid on the charges.

Levies are also charged on businesses. Dublin City Council charges €7,650 which will now rise to €11,500.

It emerged last night that concerns about the legislation surrounding section 48 and 49 were communicated to the Minister earlier this year.

While section 48 applies to direct levies to benefit the planning authority, section 49 applies to a situation where a local authority enters an agreement with another person or body to provide the infrastructure.

Sources said the Minister was told a number of times of specific fears over the legality of Dún Laoghaire Rathdown's section 49 scheme to raise money for the extension of Luas to Cherrywood.

Asked if the Minister had refuted the advice or had decided to allow the Act to be tested in the courts, a spokesman for the Minister said he had no comment last night.