Taoiseach Brian Cowen has signalled that a triple whammy of more tax increases, a public sector pay freeze and job cuts are being considered to tackle the expected €20bn Irish budget deficit this year.

The latest figures from Dublin’s Department of Finance today will show that the fall in tax returns in December was around €1.5bn higher than previously expected as the deterioration in the public finances deepened.

Mr Cowen set himself on a collision course with unions by insisting yesterday that everything would be “on the table” in his meeting with the social partners later this month and that further increases in taxes would “play some role as well”.

Today’s figures will show that there was an €8bn shortfall in tax receipts last year, meaning that just €41bn was taken in instead of the expected €49bn originally forecast by the Department of Finance.

This will bring the overall budget deficit to €13bn for last year, and Mr Cowen has admitted that the deficit could rise further to €20bn.