An indiscriminate cull of tax incentive schemes in tomorrow's Budget could discourage investors from venturing into high-risk industries, the Institute of Chartered Accountants in Ireland (ICAI) has warned the Minister for Finance, Mr McCreevy.

Initiatives that reward investment in fringe endeavours, such as urban renewal and movie production, do not exist solely to offer tax breaks for the business community - they promote projects that might otherwise never come to fruition, said Mr Brian Walsh, ICAI chief executive.

Calling on Mr McCreevy to resist the temptation to abolish tax incentives as part of a reduction in public spending, Mr Walsh said a review of these schemes should take account of their potential to create jobs and generate taxable income. "Urban renewal schemes have helped to regenerate many of our inner cities and rural towns. Incentives to develop hotels and leisure facilities have supported the tourism industry where we have seen employment grow dramatically in recent years."

Many of the sectors supported by these initiatives carried substantial start-up risk that might otherwise dissuade investors, he said.