Income tax rates on middle-income earners will be cut in the next budget, Taoiseach Enda Kenny told the IBEC CEO conference today.
Mr Kenny said the Government wants to see more people feel the benefit of economic recovery in their own lives.
"In the Budget we reduced the USC and the income tax rate on middle-income earners earning less than €70,000. We will reduce it further in the next budget and the following budgets if the Government is re-elected.
Mr Kenny also said the Government would begin to equalise the treatment the income tax system gives to self-employed and PAYE workers.
"The discriminatory tax treatment of self-employed people inherited by this Government can no longer be justified."
His comments came as the Government collected close to a €1bn more in taxes in the first two months of this year compared to the same period last year.
The main reasons were higher income tax and VAT receipts.
Speaking at the conference, IBEC chief executive Danny McCoy said businesses are more interested in introducing tax cuts for workers rather than a new national wage agreement.
IBEC Chief Executive, Danny McCoy, said income tax rates here are out of line with international trends.
''But there is no appetite in business for a one size fits all national pay agreement,'' he warned.
''To boost consumer spending and increase economic activity we should cut tax.
''Income tax rates are too high, are out of line internationally, and are a serious disincentive to work, taking a promotion or doing overtime.
''We have one of the highest marginal tax rates in the OECD and it kicks in too early. It needs to be reduced as a priority.
He added: "The decision to retain a 52pc higher marginal tax rate for those earning over €70,000 was short-sighted and will cost jobs and revenue.''
''A single worker earning €75,000 in Ireland takes home about €6,000 less than a similar worker in the UK. This is making it difficult for business here to attract and retain skilled workers.''
He said the next budget must prioritise further cuts to the marginal rate - and adjust the bands to give more money back to workers.
He also stressed strong economic growth, a rising population and record low interest rates means Ireland needs to ''ramp-up'' spending on infrastructure, as well as tackling housing and transport bottlenecks.
''If government plays its part, Irish business will create thousands of new jobs and unemployment will fall below 9pc this year,'' he added.
"Around half of companies will award pay rises this year, but many continue to struggle. This needs to be reflected in wage expectations,'' said Mr McCoy.
''If costs spiral and we lose our competitive edge we will pay for it in jobs.''
"Business has no interest in a return to one size fits all national pay agreements. Any possible future engagement between business, the government and the unions would only have merit if it was anchored firmly in the need to create jobs and secure competitiveness."