Labour Party leader Alan Kelly has said the next Government will have to be honest about the need for tax increases following the fallout from the Covid-19 pandemic.
Negotiating teams from Fianna Fail, Fine Gael and the Green Party are meeting this week for substantive talks about forming a new government.
Fianna Fail and Fine Gael have invited the Labour Party to participate in the next government but Mr Kelly said his party are still considering their options.
It comes as Taoiseach Leo Varadkar said the country faces a 30 million euro spending deficit due to the Covid-19 pandemic.
However, Mr Varadkar has said income tax will not be increased to pay for it.
Mr Kelly said it is not plausible for Mr Varadkar to claim taxes will not need to raised because of this.
“I know the Taoiseach repeated it yesterday and doubled down on it… well we can’t form part of any government that is going to act in that way or universally do that.”
Mr Kelly said the Labour parliamentary party will meet on Friday to continue discussions about potentially entering talks with them.
“We have a document from Fianna Fail and Fine Gael which is inviting us into talks and we have not heard from the Green Party.
“We have sent them a response informing them of our parliamentary party meeting which takes place on Friday.
“We have told them of significant issues that we will be asking them to respond to, the main issue is taxation.”
“We do not believe it is credible or honest with the Irish people to say that, over a five-year period, we will not in any circumstances increase taxation.
“It is just not credible.”