The government plans to cut income tax rates before 2016 to benefit middle-income families.

Junior Finance Minister Brian Hayes told the Sunday Times that tax reductions should be introduced within the next three years.

However, he said income tax will not be cut in the budget this October. 

Hayes also ruled out Labour proposals for an increase in the Universal Social Charge for high-earners, saying it is important not to send out 'crazy signals' in the current economic climate.