Ray Earwicker, chairman of Crowthorne and Sandhurst Liberal Democrats, claimed that "well-informed sources" had told him that next year, Sandhurst Town Council could increase the Coffee Spot's annual charge from £3,500 to £25,000.
The shocking claim follows months of controversy over the future of the popular café in The Memorial Park in Yorktown Way.
But Sandhurst mayor Cllr Peter North called the claims "absolute nonsense and dribble".
He said: "No one should believe a word of it. "
Residents who fought tirelessly to save the Coffee Spot from closure after learning of plans to replace it with a youth drop-in centre were convinced they had won their battle.
During a heated debate last month at a Bracknell Forest Borough Council meeting, Cllr Paul Bettison, leader of the council, assured residents "there would be a Coffee Spot for many years to come".
Cllr Earwicker said: "If true, these developments are an absolute disgrace and the residents of Sandhurst have been badly deceived.
"An increased charge on the scale proposed would put the operators out of business and no commercial organisation would even consider the new terms being offered.
"It was a back-door way of getting rid of the present Coffee Spot."
He urged people to attend the next meeting of the town council on Thursday, January 3, at 7.30pm to protest at the council's alleged action.
Coffee Spot proprietors Carol and Tina Hedges were unable to comment as the Times went to press.