Under the plans, local authorities will be given the power to set their own fees to cover costs. They will not be able to make a profit but can recover the cost of submitting an application from those benefiting.
Research commissioned from Arup in February 2009 to re-examine application costs and fees suggested that fees were ten per cent below associated costs.
The study found an overall average cost of £619 per application and an average fee of £563, while around 35 per cent of development management resources are being allocated to dealing with applications that do not currently incur a fee.
If proposals on decentralising planning fees are taken forward following consultation, local authorities will be able to set their own fees from next April.
"Having a system where Whitehall dictates to local councils what planning fees they can charge is unfair for local taxpayers around the country who are left paying for the shortfall where fees don't cover costs," declared decentralisation minister Greg Clark.
"Letting councils set their own fees is a much fairer system for both the applicant and the local taxpayer. It will ensure there is flexibility in the system to recover the actual costs of applications," he added.
Local authorities received more than 450,000 planning applications in 2009-10. The consultation runs until 7 January.