Following the release of the report from the Commission on Taxation last Monday, I spent two hours on Eamon Keane's Lunchtime show on Newstalk analysing its recommendations with others.

Most of the listeners' text messages expressed deep anger at what was being proposed. People were very angry because they are losing jobs, taking wage cuts, enduring big tax increases, sitting on properties whose value has fallen below the amount of their mortgage and, most importantly of all, not being inspired by the political leadership they are getting. To compound all of this, the government has been presented with a menu of choices, which, if implemented, would further undermine disposable incomes. The natives are getting pretty restless.

There were no surprises in the commission's report, as much of it had been selectively leaked in the weeks before publication, and indeed anybody with any knowledge of the public finances would have realised that a broadening of the tax base is as certain as death. Over the past decade, successive governments, all with Fianna Fáil in common, removed thousands of workers from the tax net and introduced numerous tax reliefs. They did this in the belief that tax revenues from construction and property would shore up tax revenues forever. This was a big mistake, cruelly exposed by the collapse in the property sector.

What we require for maximum economic efficiency is a broad tax base with low marginal rates. We have already seen the effective marginal rate for an awful lot of workers increase significantly over the past year as government seeks to rectify the mess it created. This trend cannot continue.

Back in the 1980s, Ireland had a tax system based on very high marginal rates, and it simply did not work. The incentive for people to work harder was removed, and indeed the incentive to work at all was undermined, while those with brains and ambition – and many more besides – left the country altogether. We cannot allow ourselves to be dragged back to a situation where excessive tax destroys effort and initiative, forces the educated out of the country and ultimately undermines employment.

I am amazed that some trade unions continue to rail about Ireland's so-called low tax model. Do they want their members to give up more and more of their take-home pay to an administration that has no idea how to spend taxpayers' money prudently? We don't hear unions leaders going on about wasteful spending, such as the benchmarking award to public-sector workers, but this is where our hard-earned money has gone over recent years.

I believe Irish people would be happy enough to pay their fair share of taxes if they believed the money would be spent properly and result in better public services.

Inevitably, many of the recommendations from the commission will have to be implemented, such as carbon taxes, the taxation or means-testing of children's allowance, and water charges. Some type of property tax is also inevitable and desirable, but I am not convinced by the commission's proposal for a tax based on self-assessed valuation. However, we must ensure that these taxes are not just loaded onto the existing direct and indirect tax burden.

Implementing the changes proposed is not feasible in the midst of a deep economic recession, but will have to be given strong consideration if and when we emerge from the current morass. Meanwhile, government should devote more attention to Colm McCarthy's recommendations on expenditure, which is where the real problem is.

Jim Power is chief economist at Friends First