The bird - named Star- is often seen waddling around Devon with his owner Barrie Hayman, raising money for sick children.
Barrie and Star collect £200 per day on average by visiting local businesses, and have so far raised £6,500 for a local hospice.
However, the council has informed them that they must apply 28 days in advance for a day permit, which would allow them to collect for just one day a month.
"If I was putting into my own pocket, I could understand it, but everything goes to the sick children," Hayman told Metro.
"If a permit covered me for a year and I was able to visit a different town each day, that would be fine, but on this basis I don't think I can carry on."
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The council reportedly told Hayman that some members of the public may find his pet "irritating".
Local businesses have criticised the council's decision, and have called for Star to be able to regularly collect money.
"He entertains so many people. They crowd around him, and he does an amazing job," said Sally Shephard of Blazeys Deli in Bideford.
"We all feel very upset because it's such an amazing charity. Everyone's in uproar."
A North Devon District Council spokesperson added: "All he's got to do is apply for a street collection permit, which is a fairly simple process.
"Our policy is to allow one charity collection per day per parish, so that the streets aren't full of people collecting for charity, which is irritating to the public."