The Association of British Insurers (ABI) said that a move to cut tax relief on pension contributions for people earning more than £150,000 could reduce pensions saving and destroy trust and confidence in the system.
In the Budget, Alistair Darling announced that from April 2011 tax relief on pension contributions would be gradually tapered from 40% to 20%.
The ABI worries the move would make pensions more complicated, despite bringing in measures in 2006 to simplify the pensions tax regime.
It also is concerned the Government is breaching a principle of encouragement by tax relief of people saving for their retirement.
The National Association of Pension Funds also said that the changes breach the long established principle of tax-exempt pensions contributions, and the policy recently introduced under this Government of pensions simplification.