Employers' group IBEC says the priority for the December Budget must be growth and jobs as only through growth and jobs will the country's spiralling deficit be fixed.
Launching its pre-Budget submission, IBEC's director general Danny McCoy said it is essential that the Government does not overtax the country's fledgling economic recovery.
'The bulk of the adjustment must come in the form of current expenditure reductions. The most the economy can bear in tax increases is €600m in 2011,' he said.
In its Budget submission, IBEC says that plans for a property tax should be advanced as quickly as possible and the existing tax on second homes should be doubled.
It also says that the income tax base will need to be broadened so as to bring more people into the tax net. But it cautions that there is no further scope to increase the marginal rate of income tax and points out that these rates are already very high by international standards.
The employers' body says that while it is accepted that €1 billion of the adjustment will come from the capital budget, there should be no greater reductions in capital adjustments.
It also says the Government must continue to commit to Ireland's 12.5% corporation tax.
It also calls for reform of the unemployment benefit system to ensure there are strong incentives to seek work and says the PRSI exemption for business hiring people on the Live Register should be extended.
IBEC says that tackling unemployment must be moved to the centre of the national policy debate and all new Government policy and legislative initiatives must first be analysed to make sure that they support employment.
'The Budget must give consumers confidence that we are on a creditable path to recovery and that the public finances and unemployment levels are under control,' Mr McCoy said.
'Only then will more normal spending and saving patterns resume. This is a prerequisite to the growth in the domestic economy that we so desperately need,' he added.
