The Grey District mayor says the timing of further job losses in the region could not be worse.
The Inland Revenue Department is cutting jobs in several smaller centres, including eight of the 17 full-time staff in Greymouth.
The IRD's announcement on Thursday was just days after 114 Pike River Coal workers were made redundant. The company was placed in receivership in the wake of the disaster in which 29 men at the West Coast mine were killed.
Grey District mayor Tony Kokshoorn says things appear to be going from bad to worse in the region.
"With the disaster, it's all unravelling a bit for us at the moment," he says.
The IRD says the jobs that are going were not focused on working face-to-face with the community.
Spokesperson Heather Daly says options are being explored for relocating and retraining staff that have lost their jobs.
Decision gives certainty - Dunne
Revenue Minister Peter Dunne told Morning Report staff knew restructuring would be happening at some point and had indicted they would rather know sooner than later if jobs would go in Greymouth.
Mr Dunne says workers can now consider their option and won't go to Christmas with uncertainty.
Labour's state services spokesperson Grant Robertson says although the IRD has been consulting staff for some time about job losses, the Greymouth decision is thoughtless.
Mr Robertson says the Greymouth community already has a tremendous amount to deal with and the IRD should be looking at whether it can increase services there, where the need will be greater after the mine disaster .