Taoiseach Bertie Ahern yesterday attempted to play down the issue of tax cuts and said his party's priority was investment in infrastructure and services.
Mr Ahern said that in his opinion the issue of tax cuts was "not a priority".
He also accused Labour Party leader Pat Rabbitte of inconsistency over the issue of tax rates.
Yesterday Mr Rabbitte responded that his party was not against tax cuts in principle, but had opposed the current Government's tax policy as favouring the wealthy and super-rich.
Speaking in Raheny in Dublin, where he was attending the opening of a school gym, Mr Ahern said Labour's announcement was "surprising".
"It's a change when a party consistently says one thing and criticises the Government for something and ridicules it, and says that it is something they'd never implement. And then coming close to an election they turn around, that is surprising, but I suppose inconsistency is not something that ever surprises me."
In relation to Fianna Fáil's approach to tax cuts, he said: "The priority won't be the level of tax in my view. We will continue to reduce taxes as resources permit, but it's not going to be the big issue." "I hope we don't get into an enormous debate about tax rates like we did years ago," Mr Ahern said.
"I don't think we will, quite frankly. If I was to announce this weekend we were going to continue to cut tax by 3 per cent, I'd be in the editorials this morning criticised for trying to buy votes. But then again, you know what editorial writers are."
He said Fianna Fáil-led governments had been responsible for the vast majority of the tax cuts of the last 15 years and that 80 per cent of tax payers were paying tax at the standard rate, "or paying marginal tax at that rate".
"As resources permit we should continue to try to tweak the system. It's no longer the days where we had very high effective rates of tax, or partial rates for that matter."
He said that the bigger issue for the future "is that we can keep the economy strong". This was needed "to generate and sustain the employment that we need to continue to have jobs for our young people coming out of schools and being able to resource the infrastructural requirements that the country needs".
Reacting to Mr Ahern's comments, Mr Rabbitte said his party had "always believed in fairer taxation. We have always argued for justice in the tax code.
"We have never opposed improvement for middle income earners and low income earners." He added that there were sufficient resources to address infrastructure and public services improvements while cutting the standard tax rate.
"The problem of course is not that this Government hasn't been spending money," he said. "They've been wasting money, not putting in the reforms and not getting the quality delivery the taxpayer has the right to expect for the kind of money they have expended."
Mr Ahern said he did not believe a tax cut like the one proposed by Labour would be at the cost of infrastructure.
"I'm not saying that because I think, as we go on, taxes will probably be reduced. We've been reducing taxes all of the time. The tax take in the country is going down all of the time. We're always being able to cut the rate because there are more people working, there's more activity in the economy.