Employers' group Ibec has upgraded its growth outlook for the year to 6.1% in GDP terms on the back of what it called "remarkably positive trends right across the economy".
The group had initially pencilled in growth of 3.1% for this year.
Ibec said the country's "spectacular" growth would make it the fastest growing economy in Europe this year and paves the way for income tax cuts in next week's Budget.
"There is no need for another austerity Budget, the focus instead should be on creating a better environment for job creation," it said in its latest quarterly economic outlook.
Ibec's growth prediction is more than the Department of Finance and the Central Bank's forecasts. They are looking at growth of around 4.7% and 4.5% respectively.
Stockbrokers Goodbody also raised its outlook to 5.3% growth last week and Merrion said today that it is looking at growth of 5%.
Ibec said its expected outcome would pave the way for income tax cuts in the Budget next week and eliminates the need for any further austerity.
The Central Bank last week suggested that the Government should press ahead with its adjustment and use any gains to pay down Ireland's debt.
In its latest outlook, Ibec predicted that exports will grow by over 12% this year, the strongest growth since 2000. It also predicted that imports will rise by 11% and the resulting net exports will contribute 3.5% to GDP growth.
It also expects consumer spending to rise by 1.4% this year and by 2.9% next year, as a result of increased job creation and a reduction in the Budget adjustment, which will see people's disposable income rising by around 3% next year.
On employment, it said it expects the numbers at work to return to early 2009 levels by the end of next year, while it also noted that the quality of employment growth has been better as more new roles are full-time rather than part-time.
Ibec said its business sentiment index remains high, indicating that businesses' confidence in the country's economic recovery is strong. It has pencilled in strong investment growth of 14.3% for this year and 13.8% for 2015.
The group's chief economist Fergal O'Brien said that the economy is recovering faster than expected.
But Mr O'Brien added that recent tax increases have pushed the country's marginal tax rate - at 52% - way out of line with its international competitors.
"While the Government needs to keep a steady hand on expenditure, it now has the capacity to cut employment taxes in order to put more people back to work," the economist added.
He said that Ireland's growth figures need to be taken in context and pointed out that strong growth is typical in the early stages of recovery. The economy is still 3.5% below its peak in volume terms and 7.5% down in money terms.
"Many businesses continue to face challenging trading conditions and are still hampered by a boom time cost base. However, some really tough years of economic adjustment are clearly paying off," he said.