The Liberal Democrats have walked away from their original Mansion Tax plan.

Under this, they would have imposed at 1% on the excess value of all homes above £2m.

Instead, their revised Mansion Tax will mean revaluing homes worth more than £2m and placing them into a number of additional council tax bands.

The new plans were outlined by Treasury chief secretary Danny Alexander, speaking at Bloomberg’s European headquarters.

However, there were no clues in the speech as to revenue targets or how much owners of higher-value properties would have to pay.

Nor was it revealed how properties would be revalued for example, by surveyors and/or estate agents, or using data from Zoopla and Rightmove.

The British Property Federation said it welcomed Mansion Tax announcement as being “much more sensible”.

The BPF had warned that turning the taxation of high value homes in to a political football was harming investor sentiment.

Liz Peace, chief executive, said: “We are delighted that the Lib Dems are taking this much more sensible approach to the Mansion Tax.

“The council tax system remains in principle a better way of taxing property, if the valuations on which it is based are up-to-date.

“At present we have a property tax that is based on 1991 values, when the average house in the UK was worth, £62,000, the Soviet Union was still in existence and Bryan Adams topped the charts.

“Adding some additional bands of council tax makes sense as a sticking-plaster measure, but ultimately if fairness is politicians’ goal then only a full revaluation in conjunction with more bands will do this.

“We would therefore still like to see all parties commit to a full revaluation of council tax by 2021, and make that part of their next general election manifesto commitments.”

Just before the Li/Dem announcement, Zoopla had released research, saying that Mansion Tax, as initially proposed, would have meant a £1bn tax levy on London the south east, with 67% of the amount raised coming from three London boroughs alone.

Mansion Tax, in its first incarnation, was meant to raise £1.2bn per year for the Treasury coffers.