Gordon Brown was last night facing an "open tax revolt" from his own MPs after the minister responsible for pub licensing attacked the rise in alcohol duty and dozens of Labour back benchers vented their anger at Sunday's abolition of the 10p income tax rate, claiming it will hit the low-paid.

One disgruntled MP told The Herald: "We have done a lot to help business and the better-off, but we are in danger of losing our core vote. Gordon is not listening."

Just days after Ivan Lewis, the Westminster Health Minister, warned the UK Government was "losing touch" with ordinary voters, Gerry Sutcliffe, the Culture Minister in charge of licensing, backed the drink industry's complaint that Alistair Darling in last month's Budget had pushed alcohol duty too high.

The Chancellor raised the ire of the Scotch Whisky Association by slapping 55p on a bottle of whisky while pubs complained of 4p on a pint of beer with some mounting a campaign to ban Mr Darling from their doors. In a move which will not endear him to Downing St, Mr Sutcliffe sided with the industry when he told the Morning Advertiser, a trade paper: "The industry's right to be upset. We and I, (who) speak as a champion of the pub trade, want the Chancellor to change his mind."

As the row broke, the Bradford MP performed a remarkable volteface and issued a second statement, declaring: "My comments do not accurately reflect my views."

He added: "I fully support the tax measures in the Budget and the Chancellor's decisions on tax. Alcohol duty increases will go towards helping some of the poorest members of our society."

Jeremy Beadles of the Wine and Spirit Trade Association, picked up on the minister's initial remarks, insisting: "Gerry Sutcliffe is right and the Chancellor was wrong; this is no time to be punishing the consumer with inflation-busting tax rises on alcohol."

Last night, the Prime Minister and Chancellor were also facing growing trouble on another front - over their decision in the Budget to pay for a 2p cut in the basic rate of income tax by getting rid of the 10p rate, both of which take effect on Sunday, the start of the new tax year.

Labour MPs raised their concerns that the abolition would hit the poorest in society at Monday's private party meeting in the Commons attended by Mr Brown. However, in what will be a worrying sign for the PM, some 26 yesterday made their revolt public by signing a new parliamentary motion. Two previous ones now each have totals of Labour MPs of around 40.

In the latest motion, back benchers complain that "despite assurances to the contrary" many people were being made worse off by the abolition with a disproportionate effect on the poorest in society.

They add that they are "dismayed at the response to the plight of those adversely affected" and call on the Chancellor to "bring forward measures to correct this damaging change to the taxation system".

One of the signatories, Rosemary McKenna, the normally loyal MP for Cumbernauld, Kilsyth and Kirkintilloch East, made clear she had raised concerns over the abolition of the 10p rate months ago.

She said: "I'm extremely concerned that the lowest-paid in the public sector and pensioners on low incomes are being hit hard. We are attacking the poorest and it's just wrong." She added that what she and her colleagues are calling for is not for a reintroduction of the 10p rate but for the Chancellor to make changes to, say, tax allowances and credits, so that the poorest in society do not get penalised disproportionately.

Some back benchers south of the border fear the tax change could hit them in the local elections on May 1. Nia Griffith, a parliamentary aide and MP for Llanelli, said the 10p rate abolition did "not look good" and the UK Government should have "woken up to it sooner".

The Institute of Fiscal Studies, the respected economic think-tank, has estimated the move will leave 5.3m families earning between £5400 and £18,500 a year worse off.

Last night, the Conservatives seized on Labour's back-bench rebellion and the minister's comments. George Osborne, the Shadow Chancellor, claimed the PM's tax policy was falling apart, insisting: "There is an open tax revolt in the Labour Party and it shows the government is in disarray as a serious economic crisis looms."