Ictu is to lodge a formal complaint with the European Commission over measures announced in the Budget to aid small business development.
Congress's economic advisor Paul Sweeeny said the trade union body was not opposed to investment incentives but the Business Expansion Scheme (BES) and the Seed Capital Scheme (SCS) were "expanded vehicles for tax avoidance for wealthy people".
Minister for Finance Brian Cowen announced an increase in the tax-deductible amount that can be invested in these schemes from €31,000 to €150,000, while the amount a company can receive was raised from €1 million to €2 million.
Mr Sweeney said the schemes "may appear as if they are helping small businesses, but their main effect is to shield high income earners, who 'invest' in what are too often risk-free BES schemes, from income tax.
"The cost of these schemes to the taxpayer is likely to be far higher than the stated €178 million, because most tax expenditures are underestimated. The tax forgone by the exchequer will be made up by working people," he added.
There has for some time been public disquiet over the amount of wealthy people paying little or no income tax during the Celtic Tiger years by using a variety of investment loopholes.
Mr Sweeney said Mr Cowen's announcement contradicted the Government's commitment to closing these loopholes. It also amounted to State aid which requires European Commission approval, he argued.
The Commission however, approved both the BES and SCS effective from January 2005, provided the beneficiaries employed fewer than 250 people and have an annual turnover not exceeding €50 million, or a annual balance sheet not exceeding €43 million.