Education Secretary Michael Russell is due to publish a green paper on Thursday, setting out options for the future of higher education.
The Scottish Government has ruled out the policy adopted south of the border where tuition fees are now set to rise to as much as 9000 a year.
Reports at the weekend said it wanted to continue funding universities out of general taxation.
One way to help fund Scotland's universities would be to increase the current 1820 per year fee for English students coming to study in Scotland.
A leaked letter from Mr Russell to the Higher Education Funding Council proposes giving more places to fee-paying students from outside Scotland.