Tertiary Education Minister Pete Hodgson has proposed a 2.6% increase across the board, a move which if confirmed could add between $150 and $280 a year to students' costs.
Institutions, student groups and others have until July 17 to make submissions on the proposal.
The Government introduced its "fee maxima" regime in 2003 to regularise the amounts institutions charged students with New Zealand citizenship.
There is a different fee structure for international students.
If confirmed, the 2.6% increase would not affect many University of Otago students, as most of the university's domestic fees are less than the permitted maximum.
However, Otago students will probably not be spared a fee increase next year.
Institutions whose fees are below the maximum allowed can increase them by up to 5% per annum, provided the fee remains at or below the fee limit.
A spokeswoman for Mr Hodgson's office said yesterday the 5% annual fees movement limit would remain in place next year.
Otago Polytechnic acting chief executive Dr Robin Day said yesterday the institution had not yet set its budget for 2009 and it was too early to say whether course fees would rise.
