Nazi symbols will be banned from public display and sale in Australia, under new counter-terrorism laws to be introduced next week.

Under the legislation criminal offences for displaying or selling Nazi symbols will come with a maximum penalty of 12 months in prison.

Other swastikas used as religious symbols are not included in the ban, which is expected to pass in parliament this year.

Shadow Attorney-General Mark Dreyfus accused the coalition of using "cheap smears" to try and wedge Labor on the legislation.
Shadow Attorney-General Mark Dreyfus said Australia will not profit off or glorfify the Holocaust. (AAP)

“There is no place in Australia for symbols that glorify the horrors of the Holocaust,” Attorney-General Mark Dreyfus said.

“And we will no longer allow people to profit from the display and sale of items which celebrate the Nazis and their evil ideology.

“The Albanese government is sending the clearest possible signal to those who seek to spread hatred, violence and anti-Semitism that we find these actions repugnant and they will not be tolerated.”

Displaying Nazi and Schutzstaffel symbols is part of the ban, as well as propaganda including those symbols like flags, armbands, and clothing.

The symbol will also be banned online.

The ban does not apply for religious, academic, educational, artistic, literary, journalistic or scientific use. 

Swastikas hold spiritual significance in Hinduism, Buddhism and Jainism.

Private ownership of Nazi materials, such as war souvenirs or historical items displayed in museums will not be banned. However, the sale of these items for money will be prohibited.

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