Tax rises and more spending cuts are on the way in a mini-Budget at the end of the month, the Government has warned.

The Cabinet made the decision after it studied Exchequer figures for February which showed a €2bn shortfall based on the same period last year.

Taoiseach Brian Cowen told the Dail the Government was considering taxes and spending cuts but no decision would be made until the end of the month.

“We will make whatever decisions that are necessary, based on the Exchequer figures,” Mr Cowen said. “I think it will be a combination of revenue-raising and expenditure adjustments.

He added: “We will have to consider the consequences of various options. We will make political decisions on what is emerging.”

Speculation has centred on a possible property tax and a higher tax band to catch high-earners.

The Exchequer figures for February showed total tax revenue of €5.76bn compared to €7.57bn in 2008.

The data revealed VAT receipts were down 17pc while income tax was 7pc lower at just over €2bn.

Mr Cowen said a revised Finance Bill with the new measures would have to be passed by the Oireachtas.

The public finances took up a large part of yesterday’s Cabinet meeting which a Government spokesman said lasted 90 minutes longer than usual.

The Government had previously said it would wait until the Commission on Taxation reported in the summer months.

It is not clear if the social partners will be consulted during discussions on the proposed measures.

Fine Gael leader Enda Kenny said in the Dail: “What is needed is a Budget that is fair and covers all the sectors so that people will buy into it.”

Earlier, the Government said the end of February Exchequer Returns were “disappointing” and added: “It is already clear that tax revenues in 2009 are under pressure.”

“The Government remains vigilant and is committed to restoring the public finances to a sustainable position,” a statement said.

“The budgetary position facing us is challenging and requires that we all play our part in dealing with this unprecedented economic downturn. The fiscal strategy we adopt now is of fundamental importance to the future of this country.

“This government will take the decisions that are necessary to ensure the stabilisation and sustainability of the public finances which is an essential pre-requisite to the renewal of the economy. In this regard, the Government has decided to announce the necessary measures by the end of this month.”

Employers’ body IBEC said any mini-Budget measures must be equitable and support jobs.

IBEC director general Turlough O’Sullivan said: “We need a national recovery plan based on three key principles: restoring order to banking, making a significant beginning to getting the public finances back in balance and putting supports in place to help enterprise protect the maximum number of jobs.”