Unions have called for the Government to increase corporation tax to make international companies contribute more to the crippling economy.
As Taoiseach Enda Kenny prepares to defend Ireland's controversially low corporation tax at a key eurozone summit, the Irish Congress of Trade Unions (ICTU) said a 2.5% hike in corporation tax would serve the country better than the 2% VAT increase announced in the Budget.
"If you put 2.5% on corporation tax it would raise around 850 million euro, or in that region, which is a lot more than VAT is going to raise," said ICTU chief economist Paul Sweeney.
He said corporation tax only applies to companies making a certain amount of profits. And as Irish firms are not currently profiting, it will only be foreign companies that are taxed.
"We know that US firms are making historically high profits at the moment," said Mr Sweeney.
"This country is in trouble and I can't see why firms like Microsoft and Pfizer who use our roads and our infrastructure wouldn't be asked to pay more the way our citizens are asked to pay more."
He went on: "They are making historic profits at the moment. If you're not making profits you don't pay the tax, so it's not a cost. It's totally deflationary.
Tanaiste Eamon Gilmore said earlier that the Government would not agree to change the rate, despite calls from French president Nicolas Sarkozy for an end to unfair tax rates across the eurozone. He said a hike in corporation tax would harm business and weaken the economy further.
Meanwhile, ICTU secretary-general David Begg said he does not believe the Government will be able to cut its way out of the economic crisis. He said one of the main problems with the austerity measures imposed on the Government under the EU/IMF bailout conditions was the time frame for paying back its debt.
"My view is we have to try to change these parameters somewhat," said Mr Begg. "I believe the possibilities do exist to do that in relation to the debt situation. The problem is the debt and the time period over which we have to pay for it."