Labour's questions on whether David Cameron's elections adviser tried to influence policy on tobacco packaging amount to a "smear", the chairman of the Conservative Party has said.
Two shadow ministers have written to ask whether Lynton Crosby was involved in the decision to delay plans to bring in plan cigarette packets in England.
The Times says his company is used by tobacco giant Philip Morris.
But Tory chairman Grant Shapps said Mr Crosby had no role in setting policy.
Ministers had been thought keen to go ahead with the cigarette packaging proposal, designed to discourage young people from smoking by making the packets less attractive.
But a decision was delayed last week, after a Department of Health consultation found views on whether this would be effective were "highly polarised".
'Standards'Under the plans, resembling the system recently introduced in Australia, the standardised packets would all be the same colour, with the same font, and carry a prominent graphic warning.
The Times reports that Mr Crosby's lobbying firm Crosby Textor (CTF) has been advising Philip Morris, whose brands include Marlboro, since November.
CTF was also employed by British American Tobacco in Australia, but the company said the lobbyists had not worked on its campaign against plain packaging there.
Shadow health secretary Andy Burnham and shadow cabinet office minister John Trickett have written to the cabinet secretary to ask whether Mr Crosby has had any influence on UK tobacco policy.
Mr Burnham told Sky News' Murnaghan show there should be "more focus on the government and the Conservative Party and where they get their money from, and whether they are practising the highest standards".
But Mr Shapps responded: "First of all, every policy which is decided upon by the government is decided upon by the coalition... the Lib Dems and Conservatives."
He added: "Lynton Crosby advises the Conservative Party on political strategy; he doesn't advise on policy."
Mr Shapps went on: "This is looking like a smear campaign."
On the delay in adopting plain packaging, he said: "Only one country in the world is doing that: Australia. We have no evidence one way or another whether this is reducing smoking.
"This country has a good record on reducing smoking... We are not at all afraid to take steps. [But] we want to take steps based on evidence."
In a second letter, Labour's Mr Trickett asked the prime minister whether he would sack Mr Crosby if he refused to give up his "conflicting interests".
Liberal Democrat MPs have also questioned whether Mr Crosby should be allowed to continue his work for Number 10.
Former health minister Paul Burstow told the Observer: "Lynton Crosby cannot remain at the heart of government while he is also serving the interests of the tobacco industry.
"If he does not go, the prime minister should sack him."
The Scottish government says it will press ahead with its own plans to introduce plain packaging.
The Welsh government said it was "disappointed" by the delay and would consider "the way forward" while the Northern Ireland executive said it would like to see a "UK-wide" response to the issue.
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