Traders are in "uproar" over red tape which means a pet duck who has raised more than £6,500 may have to hang up his trademark bow tie.
Barrie Hayman was furious to be told that he and his duck Star are no longer allowed to collect for Children's Hospice South West without a permit.
District councils say it is essential that they are fair to all charities, and that they limit how often members of the public are asked to donate by various organisations to avoid it becoming "irritating".
But Mr Hayman, who collects an average of £200 per day by taking his waddling wonder into businesses around North and Mid Devon, says he would have to apply 28 days in advance for a single day's permit, and that he would only be allowed to collect on one day each month.
"If I was putting into my own pocket, I could understand it, but everything goes to the sick children. 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."
Mr Hayman said the enforcement was started by North Devon District Council, who told him other charities had complained. He is now facing the same instructions from Torridge and Mid Devon district councils.
But he has won backing from local businesses. Sally Shephard, of Blazeys Deli in Bideford, said traders were "very upset".
"That duck is happy. If other charities have complained, they must be jealous that Barrie has got off his backside to do something to help Children's Hospice South West.
"He entertains so many people. They crowd around him, and he does an amazing job.
"We all feel very upset because it's such an amazing charity. Everyone's in uproar."
A North Devon District Council spokesman said: "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. We need to give all charities equal opportunities to collect."
Alana Marie Smith, director of fundraising for Children's Hospice South West, said the charity "fully accepts" the needs for supporters to raise funds within legal requirements, and said: "Barrie Hayman and Star the Duck are tremendous in their fundraising efforts for Children's Hospice South West and in their wonderful support of the sick children at Little Bridge House Hospice in Fremington."