A sugar tax is certain to feature in Mr Donohoe's Budget speech but will not be introduced before April 2018.
In an attempt to raise extra revenue the Government are exploring a number of tax initiatives with a charge on fizzy drinks top of the list.
It is expected the ‘sugar tax’ will come into force for April 2018, on the same day that a similar levy is being introduced in the UK.
Fianna Fáil have sought a number of measures to bring about improvement in education, among them an increase in guidance counsellors, investment in third level and a reduction of the pupil-teacher ratio by one point to 25:1.
The party wants to increase taxes for employers to fund investment in third-level education.
Micheál Martin’s party has proposed increasing the National Training Funding levy on employers via PRSI by 0.1pc, which would raise an additional €66m.
In a Budget document seen by Independent.ie Fianna Fáil suggests increasing the employer tax from 0.7pc to 0.8pc.
This would be on top of another €44m the party believes should be taken from Exchequer funding to increase grants to third-level institutions.
In terms of public services, the figures of over 500 new teachers and at least 800 new gardai have been discussed.
Mr Varadkar has indicated the budget for health will be increased next week (it is expected that all departments will see a budget increase).
Scoliosis services will likely receive extra funding and a reduction in prescription charge fees for 65 to 69-year-olds is also expected.
“The word around the campfire in the HSE is always that the cupboard is bare yet the facts say otherwise. We have the biggest health budget in the history of the State,” he said.
“We have the biggest health budget in the history of the State and it will rise again next year. It will not be long before we are in the top two or three in the world in terms of spending per capita."