The Government was urged today to increase taxes on the wealthy and raise the lowest social welfare rates in a bid to close the gap between rich and poor.
The (CORI) warned of a "dramatic" widening divide, blaming unfair taxation rates and low expenditure on social initiatives such as unemployment and healthcare.
In its annual socio-economic report CORI claims Ireland collected less tax per head than any other country in Europe in 2002, with a taxation level 5.5 per cent below the EU average.
Ireland's tax rate in 2002 was 28 per cent of its GDP. Worldwide only two other countries collected less tax, and CORI warned the deficit is reflecting on social provisions and infrastructure.
It says Ireland's spending on social protection is the lowest in Europe and highlights a "considerable gap" between Ireland and the next lowest country, Spain.
Expenditure in areas including health, disability, housing and the elderly are suffering a knock-on effect, the report claims, which in turn is leading to increased levels of poverty.
In 2000 EU member states spent an average of 27.3 per cent of GDP on such vulnerable groups, while Ireland spent just 14.1 per cent.
CORI says the gap between rich and poor will never be bridged unless a larger share of national income is gathered and invested.
It describes Ireland as a "too-low-tax economy" and suggests corporation tax should be raised from 12.5 per cent to 17.5 per cent.
Social welfare payments must be increased to an "adequate level" in order to address Ireland's relatively high rate of income poverty and minimise social exclusion, it suggests.
CORI represents Catholic institutions throughout the state. The 187-page report is based on figures published by the European Commission.
The Labour Party has called on the Government to increase social spending following the release of the CORI research.
Mr Willie Penrose, the Labour spokesman on Social and Family Affairs, claimed the figures exposes the Government's "irresponsible and laissez-faire attitude towards the most deprived in our society."
He accused the Government of squandering €100 million on consultants over the past three years. "There is clearly something wrong with this picture," he said. "It is shameful that during such economically prosperous times this Government is not taking care of those who have been left behind."