The Welsh Conservatives would aim to cut the basic rate of income tax in Wales by 2p in the pound if they win the assembly election.
Powers to vary income tax will be devolved to Cardiff Bay under plans published by the UK government.
This is expected to happen within the next five-year assembly term.
The Tories previously suggested a 1p cut in the basic rate, and are offering a 5p cut in the higher 40% rate.
Writing in the Sunday Times, Welsh Conservative leader Andrew RT Davies said: "This election is a watershed moment for Wales, with the assembly set to receive powers to vary income tax levels for the first time.
"At last we will have a mature, accountable legislature, and an executive which is forced to take responsibility for some of the money it spends and raises. A bona-fide Welsh parliament."
The Conservatives would not raise any income tax levels, he added.
"It is my aim to make Wales the low tax capital of the UK. When powers on tax are devolved, it is our ambition to reward taxpayers," he said.
"A 2p cut to the basic rate should be within reach."
The basic rate of income tax is currently 20p, and the higher rate, levied on annual income above £43,000, is currently 40p.
Cutting the basic rate of income tax in Wales by 1p would cost around £180m a year, with a 2p cut costing around £360m.
The Conservatives have not released detailed costings of the tax plans, but the party's policies on tuition fees and means-testing prescription charges would represent savings in the Welsh Government budget.
Mr Davies said last month that only health spending would be protected if his party won the election.
Welsh Labour, which has promised not to change income tax rates over the next five years, said the Tory policy was a "desperate last throw of the dice".
"They have already taken £1.2bn out of Wales and today's announcement would see a further £360m lost," said Jane Hutt, the finance minister.
"This uncosted promise would drive a bulldozer through Wales' finances and would mean huge cut to critical public services."
Plaid Cymru say they would not increase income tax, but they would introduce a new "middle rate" of income tax, representing a small cut in the current higher rate.
The Welsh Liberal Democrats back a 1p cut in the basic rate, while UKIP wants a referendum to be held before the tax is devolved.
Chancellor George Osborne announced he was scrapping the requirement for a referendum on the issue while presenting his autumn statement in November.