Telford & Wrekin Council is calling on the Government to keep the measure, saying thousands of families will be affected in the borough.
The weekly funding boost started in April last year and was designed to help people through the pandemic which hit people's finances.
But it is due to be phased out in September.
Universal Credit claimants will receive £86.87 a month less once the uplift is phased out.
Council bosses say the extra money has been a lifeline for many during the pandemic and the change will affect more than 6,000 families in Telford & Wrekin alone.
They say those that are lowest paid will be hit the hardest and economic recovery in the town will also suffer because of it.
Councillor Richard Overton, Telford & Wrekin Council's deputy leader and cabinet member for enforcement, community safety, customer services and welfare reform, said: “This funding has been a life saver for many families during the pandemic, many of whom are in work or want to be in work.
“People are still struggling following this crisis and this support is still needed.
“This cut in Universal Credit will hit the lowest paid hardest and hurt our economic recovery in Telford & Wrekin.
“Over six million families, which include 6,205 families in Telford & Wrekin, are set to lose £1,000 a year.
“Times have been hard, we know that there was a 100 per cent increase in Universal Credit claimants from March 2020 in 16 of our 29 wards in Telford & Wrekin at a time where out of work support has been left at its lowest level in decades.
“Several people are going to struggle financially and be pushed below the poverty line.
“That’s why the council has approved a motion put forward by Councillor Angela McClements and Councillor Gemma Offland to make the Universal Credit uplift permanent.”
Telford & Wrekin Council is encouraging people who are going to struggle financially to look at the help that is out there.
Councillor Overton added: “If you are struggling with a reduced income as a result of the coronavirus pandemic, we have a range of benefits that could help you.
“There are also a number of government benefits and partner organisations that could assist you.
“On our website we have a financial support and assistance guide so people can see all of the support that is available in one place."
Visit telford.gov.uk for more information.