DOMESTIC air travellers face higher fares to cover the cost of airlines' greenhouse gas emissions - estimated at $100 million or more - if the Federal Government's emissions trading scheme is passed by Parliament next year, leading airlines warn.

And that, they claim, could hurt the Australian tourism industry, which employs about 500,000 people.

Domestic air travel in Australia has more than trebled over the past 20 years, with people making over 50 million trips in 2008-09.

Qantas and its low-cost sibling Jetstar say by 2012 they could be looking at an extra $50 million to $60 million in emissions costs to comply with the Rudd Government's scheme, as well as new emissions schemes in New Zealand and Europe.

Qantas' head of corporate relations, David Epstein, said there were only two ways to deal with the cost burden: ''Either the ticket prices go up or the margins go down, reducing the viability of the routes.''