A cap on political donations and State funding for smaller parties is under consideration by the Government as part of radical electoral funding reform.
The Tanaiste, Ms Harney, yesterday said the Government is also considering a ban on foreign funding.
Ms Harney said she would favour a cap even lower than the £4,000 believed to have been proposed by the Minister for the Environment, Mr Dempsey.
Asked about a report in the Sunday Business Post, she said: "I would like to see a cap with a reasonable amount. I don't want to pin myself to any particular amount but I would be talking that type of sum or lower. Obviously we are talking about euro which arises next January. It would be a manageable euro sum." The cap would apply to corporate and individual donations, the Tanaiste added.
On the controversy over the $50,000 donation to Fine Gael, she said the late Mr David Austin wrote the cheque. "So I think that proves the point that you can't distinguish between corporations and individuals."
On foreign funding, Ms Harney said there would be no point in capping donations and leaving the door open for foreign funding. She said she would also be pushing for some type of State funding for smaller parties.
Speaking in Tokyo, where she is leading the biggest ever Irish trade mission, Ms Harney said political funding was under review in the context of the Electoral Bill before the Oireachtas.
"We have been discussing in government the issue of a cap on political funding and what bringing in one would mean.
"There are a number of issues being discussed including whether foreign funding should be continued and whether or not there should be a cap on the amount of political funding, and the Attorney General has given advice in this area."
There is no limit on the amount a company or individual can donate, while donations over £4,000 must be declared.
On State funding for smaller parties, Ms Harney said restricting private fund-raising would mean the taxpayer having to pay more.
"I want to make sure that smaller parties are not discriminated against and that you don't reinforce the status quo politically.
"Any increased State funding under the present regime would probably suit the larger parties to the detriment of smaller parties, so anything we would agree to would have to bear in mind the consequences for smaller parties or new parties emerging."
The Tanaiste said she was concerned that improper payments of money to politicians was being confused with legitimate fund-raising. "The two are very separate."
She denied the proposed cap on donations was a knee-jerk reaction to Fine Gael leader's declaration that his party would not accept donations from businesses.
The Tanaiste said what was required was "better disclosure and more reasonable caps. The issue is the amount of money given, the manner in which it is given and the purposes that money was given in the past."
She said she had not spoken to the Taoiseach on this issue in the last week but said it had been "on the agenda" for 18 months.