As well as single fares, the multi-operator WY DaySaver tickets available through the MCard app and smartcard will be reduced from £5.50 to £4.50 from September.
Funding for new bus routes to reconnect as many communities as possible left isolated by service changes over recent years will also be made available.
The proposals build on West Yorkshire Combined Authority’s revised Bus Service Improvement Plan, submitted to the Department for Transport earlier this month.
The new £2 maximum fare will be negotiated with the bus operators through the new West Yorkshire Enhanced Partnership, which started on 1 April this year.
Tracy Brabin, Mayor of West Yorkshire, said: “When I became Mayor a year ago, I promised to make bus fares simpler and cheaper across West Yorkshire. Through our new Enhanced Partnership with bus operators that’s exactly what we’re doing.
“The proposed new £2 maximum fare will make a difference to people’s lives, helping to make bus travel an affordable choice. It will significantly cut the cost of travel for people making journeys over 3 miles, in some cases by £1.50.
“You can hop on a bus from Marsh to Lindley, Bradford to Keighley or Halifax to Leeds and know that you won’t have to pay more than £2 for your trip.
“And the full roll-out of ‘tap-on, tap-off’ next year means people won’t have to plan their journeys in advance – they can travel on as many buses as they need for the whole day and never pay more than £4.50.
“We’ll also be investing over £25m to develop new bus routes to reconnect those communities left isolated by recent service changes, particularly in our towns and villages, to help people reach health and leisure services, work and learning opportunities, and to see family and friends. Our consultations on which new and existing routes to support will begin next month.
“I want people to see buses as the first choice for the journey they want to make. The investments we’re making to reduce fares, develop new routes and introduce new zero emission buses mean they will be a cost-effective environmentally-friendly way to travel in West Yorkshire for years to come.”
If the plans are approved by the Department for Transport later this year, the new £2 maximum fare will be the first scheme delivered under West Yorkshire’s Enhanced Partnership.