Minister for Agriculture Simon Coveney has said the licensing system for horses has to be "radically changed".
Speaking on RTÉ's Morning Ireland, Mr Coveney said the system whereby seven individual bodies currently issue horse passports would have to end.
He said this would be replaced by a centralised issuing body controlled by the Department of Agriculture to ensure there is a "watertight system".
His comments come after an inspection at Ossory Meats in Banagher, Co Offaly, found that 25 horses presented for slaughter had irregularities relating to their passport and microchip identification.
Mr Coveney said that to deliberately falsify the identity of a horse was a criminal offence.
However, he rejected suggestions that the wholesale slaughter of horses in Ireland should stop until the new licensing system is in place.
Mr Coveney said that currently horses are only being allowed into the food chain on a "positive release" basis.
This means that every single horse carcass that is slaughtered is tested for the drug bute - which is used on horses but poses a risk to humans - and only when they pass the test are they released into the food chain.
Previously, carcasses were only tested on a random basis.
Mr Coveney said that although the pilot project, which has been running for the past month, was expensive, it is necessary to preserve the integrity of Irish food.
Meanwhile, the Irish Cattle and Sheep Farmers' Association has called on Mr Coveney to take a much tougher stance with meat processors who fail to meet traceability standards.
Also speaking on Morning Ireland, ICSA President Gabriel Gilmartin said farmers are forced to comply with strict conditions when it comes to traceability and he wants the same regime introduced for meat processors.
Mr Gilmartin said the minister would have to start imposing serious financial penalties on processors where identification irregularities have been found.
The IFA Chairman of the Horse Project Team, James Murphy, has rejected suggestions that the slaughtering of horses should be halted until a new licensing system for horses is introduced.
Mr Murphy said over 24,000 horses are slaughtered in Ireland every year and he called it a legacy of the boom.
"It's an unfortunate figure bearing in mind we don't breed horses for slaughter. But it's a legacy of the Celtic Tiger years when it was almost a fashion accessory to have a horse."
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