The National Competitiveness Council has urged the Government to introduce a property tax to repair public finances.
The council outlined that the move could raise €1.4bn per year if a charge of €1,000 per home was introduced.
In its latest report, the council warns that the competitiveness issue has to be addressed.
NCC chairman Dr Don Thornhill said that a reduction in local authority commercial rates was vital to ease the competitiveness burden on struggling Irish businesses.
The NCC says recent falls in energy prices were necessary, but did not go far enough and said that there was a need for phasing out of price supports for renewable energy as its use increases.
The council, which advises the Taoiseach on competitiveness issues, has said that the price of land, office and factory space and housing in Ireland needs to adjust to the levels justified by their underlying potential for adding value or earning rent.
The NCC said it was important that the actions taken by the banking sector and the National Asset Management Agency should result in an appropriate adjustment within the property market.
"While Ireland's competitiveness has improved during 2009, this to a great extent reflects the sharpness of the recession rather than competitive advantages arising from structural change," the NCC said.