The Federal Opposition has accused the Immigration Minister of seeking "Trump-like powers" to review the visas of certain people based on their nationality, race or religion.
The Government wants to introduce a process to "revalidate" the health, character, employment and contact information for some long-term visa holders, as part of its plan to trial a 10-year visa for Chinese nationals.
If "adverse information" is found about a recipient during that check they could lose the visa.
Labor said while it supported the idea of revalidation for the long-term visa, it was now worried the proposed powers could go much further, with one MP warning it could represent a slide into fascism.
"Ultimately Labor cannot give Trump-like powers to a minister who has such a high desire to see a divided Australia," Shadow Minister Shayne Neumann told Parliament.
"Labor won't support a bill that could see whole groups of people targeted on the basis of their place of birth, passport or religion."
Mr Neumann said Labor was in favour of the pilot program to grant Chinese nationals the 10-year visitor visa, which is designed to help boost tourism and develop Northern Australia.
But he said as the bill was currently written, Immigration Minister Peter Dutton could order a similar revalidation check on visa holders from any "class of persons" if he thought it was in the public interest.
The explanatory memorandum to the bill said the public interest power would only be used in rare circumstances, but Labor is particularly worried such a check could not be disallowed or overturned by Parliament.