The Child Poverty Action Group says Working for Families is discriminating against Pacific children in need.
The government welfare package provides extra money for families with the aim of making it easier to work and raise a family.
Group spokesperson Donna Wynd says a recent report by the Salvation Army on Pacific people shows they are more likely to have lost their jobs in the economic downturn.
She says that means they are also more likely to have lost their in-work tax credits of $60 a week for up to three children and $15 a week for each extra child.
Ms Wynd says Pacific families were already struggling - even with jobs and Working for Families - so to lose them is a double penalty for them and their children.
The Child Poverty Action Group will ask the Court of Appeal next week to rule that the in-work tax credit is illegal because it discriminates against children whose parents are not working.