Town halls have been urged by the Government to scrap parking charges in a bid to save declining high streets.
Communities minister Marcus Jones told The Telegraph that there was clear evidence that removing meters boosted trade for local outlets.
Figures showed parking revenues would hit a record £687 million this year, the newspaper said, up £39 million at a time when councils face severe funding cuts from Whitehall.
Retailers and motoring groups have long accused authorities of using drivers as a "cash cow" and ministers have repeatedly called for charges be relaxed.
The latest push comes after reports of booming sales at shops in Cardigan, Mid Wales, after pay-and-display machines were put out of action by vandals.
Asked whether small towns should become "meter-free zones", Mr Jones said: "You can look at examples around the country where that very situation is currently in place, and in those areas where they are thinking very carefully about how they attract more people on to their high street and in to those smaller town centres.
"Those areas seem to be doing better and I think it's really important that councils understand that and develop their policies to make sure that they are attracting people to come and shop and frequent the high street.
"Unfair parking fines push up the cost of living and undermine high streets. Instead, councils should be focusing their efforts on supporting our town centres and motorists, not by raising money through over-zealous parking enforcement."