The Welsh Liberal Democrats say they would want to cut the basic rate of income tax by 2p if Wales gets the power to change taxes. The party estimates that reducing the rate from 20p to 18p would cost around £360m but would give the average worker an extra £750 a year.
In an article written for the Institute of Welsh Affairs, the party's leader Kirsty Williams says future Welsh Governments must 'think big' if they gain powers recommended by the Silk Commission. She said,
Making up £360 million in such taxes may well be difficult, but it is something the Welsh Liberal Democrats want to prioritise so that we can realise our aim of fairer taxes while at the same time supporting a stronger economy.
My party will remain committed to reducing the tax burden for those on average income and restructuring the tax system so it delivers both a fairer society and a stronger economy.
I am already pleased that Liberal Democrats in government in Westminster have cut taxes on the lowest paid by increasing the threshold for the personal allowance. But this does not mean Wales, with her radical political tradition, should not try to do more.
The party's finance spokesman Peter Black told me that the move would be in keeping with the ideals of the last Liberal Prime Minister, David Lloyd George, whose 150th birthday is being marked today.
It makes the Lib Dems the first party to say what they would do with income tax if they were in government and if those powers had been transferred.
In November, the Silk Commission recommended that the Welsh Government should have power over some of the income tax collected here in Wales and the power to vary its rates.
But any change such as the one proposed by the Lib Dems could be a while coming.
The Silk Commission said there should be a referendum first and that any transfer of powers would be unlikely before 2020.