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Under the plans properties valued over £1m will face an annual levy of 0.5% of the value exceeding £1m.  For instance, a property valued at £1.1 would face an annual tax of £500 whilst for a £2m property the tax would be £5,000.

The extra £1bn revenue generated would be used to reduce the tax burden of low earners, with the intent of bringing the 4 million people who earn less than £10,000 out of taxation.

Speaking on the BBC’s Breakfast program, Treasury spokesman Vince Cable said, “We're talking about this proposal to raise money, to cut taxes on people who are at the bottom end of the income scale or on average income.

"Our overall tax proposal is about lifting four million people - workers and pensioners - out of taxation and cutting taxes for people at the bottom end in a fair way."

While saying he cannot rule out that the overall burden of tax will rise in the future, Mr Cable will say his latest measures are revenue neutral.

Party leader Nick Clegg stated that he felt the mood had shifted over the past ten years: "I think people, even at the top end, now accept we need to try and rebalance things a bit so that everyone moves together - the whole of society moves together."