Vince Cable has told BBC News he was forced to ditch plans for an annual tax on homes worth £1m or more over fears it would alienate middle class voters.
The Lib Dems have wealthy property owners in their sights
Treasury spokesman Mr Cable said he was persuaded to drop the policy last year by Lib Dem party colleagues.
But he said he was now devising a new policy to address the "problem of extreme wealth in property".
Mr Cable earlier unveiled plans to tax the "super rich", at the party's spring conference in Liverpool.
He told the conference he would "like to see a stronger commitment to cutting the taxes of low and middle income families."
To pay for that, he added: "I would like to see a much tougher approach to the windfalls on property and land values enjoyed by the super rich."
Explaining the move in an interview with BBC Radio 5 Live's John Pienaar, he said he did not think it was right that the owners' homes worth as much as £18m in some parts of London just paid standard council tax.
But he said plans unveiled this time last year for an annual 1% levy on homes worth £1m or more had been dropped after pressure from party colleagues.
Asked if that was because such a move could damage the party in the eyes of middle-class voters, Mr Cable said: "Certainly that objection was made.
"I have listened to the objections on that specific proposal and we have not pursued it".
He added: "We will be coming back with something that addresses fully the problem of extreme wealth in property which currently attracts no more than nominal council tax."
Earlier in a speech to the party's spring conference, Mr Cable told wealthy non-domiciles - who live in the UK but pay no tax on overseas earnings - to "pay up or pack up".
Labour and the Conservatives have both outlined plans for a levy on non-doms, but Mr Cable said they had not gone anywhere near far enough.
He said: "After 10 years of dithering Gordon Brown has decided to act.
"As a veteran of the struggle against Mrs Thatcher's poll tax, he has decided - you've guessed already - to introduce a poll tax.
"Billionaire Lakshmi Mittal is to pay the same tax as a non-dom shopkeeper.
"Not surprisingly, the Tories agree that this is fair, indeed, they claim to have thought of it first.
"Yet there has been an almost hysterical reaction from the City. How dare British politicians query the tax privileges of the rich?
"If we are not careful, they say, Russian and Ukrainian oligarchs living in 80m houses will no longer feel welcome and go somewhere else. 'Pay up or pack up'
"That's tough. Let them go. We say that foreign expatriates are welcome to live and work in Britain.
"But when they have been here seven years, they pay British tax like the rest of us. Pay up or pack up."
Mr Cable also said he wanted to be more "radical" in his approach to taxation.
"I would like to see a much tougher approach to the windfalls on property and land values enjoyed by the super rich," he told delegates.
Mr Cable also used his conference speech to set out proposals for an increase in tax on "high alcohol" drinks to be offset by a cut in the VAT on fruit juices from 17.5% to 5%.