Curiouser and curiouser.

Yesterday morning Liberal Democrat Business Secretary Vince Cable appeared to confirm in a radio interview that negotiations were in progress within the Coalition with a view to replacing the 50p income tax rate with some other form of tax on the wealthy.

It seems almost incredible that a Government that likes to talk about fairness could contemplate cutting income tax for those earning more than £150,000, when single-income households on less than a third of that are about to lose thousands in Child Benefit. What is more, next month upward of 11,000 Scottish low-income families face losing tax credits of nearly £4000 a year.

However, it seems that the Chancellor has been listening to those on the right of his party, who claim that the top rate is driving wealth creators out of Britain. In the Budget on March 21, he may also argue that the 50p rate has failed to raise the sum anticipated – around £2.8bn a year. The independent Institute for Fiscal Studies was always sceptical about that figure because high earners can afford to pay clever accountants to minimise their liability.

The LibDems meanwhile, who claim they were not "ideologically wedded to the 50p tax rate" seem prepared to accept its abolition in return for one of Vince Cable's pet ideas, a tax on mansions. He sees it as a way of extracting money from wealthy non-doms, who own many of the properties worth in excess of £2m in London and the south-east.

It could be levied centrally as a separate tax by HMRC or through council tax by adding one or more extra bands at the top. Given the urgency of the Coalition Government's desire to reduce the deficit, one would expect any such proposal to be up and running within a year. But where does that leave Scotland? Apart from the small matter of a council tax freeze that has already lasted five years and is likely to last another four, properties in Scotland have not been revalued for more than 20 years. At the last count, in April 1991, fewer than 13,000 homes were reckoned to be worth more than £212,000 (Band H), let alone £2m.

Given the length of time it would take to revalue Scottish property, a Scottish mansion tax looks like a non-starter. Even today few properties are worth more than £2m, so it would raise next to nothing anyway. So would the Scots get away scot free? Perhaps a mansion tax only looks like a clever way to extract money from wealthy people until one examines it more closely.

One Scot who was not chortling at this prospect yesterday was Sir Malcolm Rifkind, MP for Kensington and Chelsea, where, by his calculation 40% of property that would be caught by this tax is situated. Sir Malcolm made the point that if you are going to tax wealth, why choose property – mostly London property - and ignore those whose wealth is in shares, land, office blocks or works of art?

In short, a mansion tax seems doomed to collapse under the weight of its own contradictions. There is certainly scope for George Osborne to cut off tax loopholes that enable millionaire property buyers to avoid paying 5% Stamp Duty by putting the transaction through a company. However, if Mr Osborne has any largesse to scatter on Budget Day, he would be well advised to use it raising tax thresholds. Putting money in the pockets of ordinary citizens is the best way to kickstart the economy.