Shadow Chancellor Ed Balls has called for the government to cut pensions tax relief to 26% for people earning more than £150,000 per year.
These earners receive 50% tax relief, which could be better spent on tax breaks for the lowest earners, Balls said.
However, the Conservatives and the Association of British Insurers (ABI) have been quick to condemn the idea.
The comments from Labour come after several weeks of speculation over the Coalition's plan for higher rate pensions tax relief, which will be revealed in next week's Budget.
Balls today claimed that fewer tax breaks for the rich would mean no changes need to be made to child tax credit or working tax credit.
However, Otto Thoresen, director general of the ABI, said Labour's pension changes whilst in office had damaged confidence in saving already.
"Changing higher rate relief rules for the third time in four years as Labour proposes would send the signal to everyone that it is not worth them bothering to save into a pension because the tax rules will always be changing," he said.
"The last Labour government's proposed tax relief tapering rules for people earning above £150,000 were scrapped by the incoming government because they were completely unworkable, and replaced with a simpler restriction that raises the same revenues.
"Attacking the incentive for higher earners to save into their pensions will further limit the insurance industry's ability to invest in the economic growth and infrastructure which Labour wants to see."
Conservative Party deputy chairman Michael Fallon said: "At his sixth relaunch earlier this year, Ed Miliband promised Labour would no longer call for unfunded Budget giveaways.
"But in just two months since then, he and Ed Balls have broken this promise by irresponsibly calling for £31bn of unfunded spending increases and tax cuts. That means more borrowing and more debt every year."
