Foreign investment in agricultural land will come under greater scrutiny, with investments of more than $15 million to be screened by the Foreign Investment Review Board (FIRB).
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The Abbott government said on Wednesday it was lowering the threshold for screening from $252 million to $15 million from March 1.
The $15 million threshold will be cumulative so that investors who make multiple purchases that add up to $15 million will be assessed.
Speaking at a sheep grazing property outside of Canberra, Prime Minister Tony Abbott said Australia had been built on foreign investment, but any purchases had to be in the national interest.
"We do want foreign investment but it's got to be the right investment, the right investment that serves our purposes," Mr Abbott said.
"It needs to be transparent and that's exactly what will happen as a result of this important commitment that the government is implementing from today."
Mr Abbott said from July 1, the Australian Taxation Office would begin a "stocktake" of all new foreign investment in Australian agricultural land, regardless of value.
Treasurer Joe Hockey said the government would respond in coming weeks to a House of Representatives report on residential real estate investment by foreign investors.
"We'll also have more to say about setting up a land register so that we have a better understanding of just how much foreign investment is in Australian land," Mr Hockey said.
"This is about integrity in the system.
"We want to know what the true state of foreign investment is in Australian land and, in particular, agricultural land."
But the Treasurer did not clarify why there was a delay in the government's response to foreign investment in residential real estate, or how it would fund better enforcement of FIRB rules.
Agriculture Minister Barnaby Joyce lashed out at the Labor Party, which he said would oppose the changes.
"Penny Wong is going to fight us on this issue," he said.
"Because they just want to fight us on everything."
CBRE Agribusiness warned the changes would deter potential investors.
"The changes create an additional level of risk and uncertainty in being able to complete a transaction," regional director Danny Thomas said.
"It is difficult to see who of the active and aspirational foreign investors will view this change as anything other than dispositive, particularly in light of the meagre threshold which has been adopted – a $15 million limit will capture a high proportion of transactions."
