The 800,000 flights - to popular Queensland destinations, Alice Springs, north-west Tasmania and other locations largely dependent on air travel - are part of a push by the federal government for state leaders to avoid snap lockdowns and border closures and give people confidence to book holidays.

The travel sector has been crying out for assistance as the end of the JobKeeper wage subsidy program looms, with snap state border closures and lockdowns stifling the domestic tourism sector, even with international travel off the table.

Worth $1.2 billion, the package will also include a loan scheme for small businesses, financial support for international airlines to stay "flight-ready," and support for airport ground handlers to retain accreditation.

The discounted flights will be available between April 1 and July 31, including term one school holidays around the country, with the 50 per cent discount to be on flights both to and from the destinations. Australians won't have to register with the government but just book the flights through the airlines themselves, starting April 1.

It's hoped the program will increase demand on the routes, increasing the number of flights running to the destinations.

Regional towns like Merimbula in NSW and Devonport, Launceston and Burnie in Tasmania are on the initial list of approved destinations for half-price flights.

Six of the initial 13 locations are in Queensland, including the Gold Coast, Cairns, the Whitsundays, Prosperine, Hamilton Island and the Sunshine Coast.

Remote locations Broome in Western Australia, Alice Springs and Lasseter region in the Northern Territory are also on the holiday list.

Avalon airport in Melbourne and Kangaroo Island in South Australia are also included.

With international tourism at a standstill with no prospect of returning this year, tourism operators, travel agents and the aviation sector have hoped domestic tourism would keep their businesses ticking along.

Despite positive signs, overnight trips were down by 26 per cent in November, according to Tourism Research Australia, and operators say snap border closures are to blame.

Earlier this week Prime Minister Scott Morrison said 2021 required a different response to COVID-19 than in 2020, saying that as the vaccine rollout continues it will be harder for state leaders to justify lockdowns and border closures triggered by sometimes just a single case of the virus.

"It's important that all premiers, chief ministers, prime ministers make decisions that are very commensurate with the new risk framework that we are facing this year, which is different to last year," he said.

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Small and medium businesses still relying on JobKeeper up until the program ends in March will be eligible for loans worth up to $5 million under the support package to be announced on Thursday, with loan periods up to 10 years, and no repayments for the first 24 months. Businesses will be able to use these loans to refinance existing debts.

The program is an extension of the existing loan scheme for small and medium businesses, and the government expects more than 350,000 current JobKeeper recipients are eligible for the loans.

Mr Morrison labelled the program "our ticket to recovery", with money spent in domestic tourism to support jobs and investment in the tourism and aviation sectors.

"Our tourism businesses don't want to rely on government support forever," Mr Morrison said.

"They want their tourists back. This package, combined with our vaccine rollout which is gathering pace, is part of our National Economic Recovery Plan, and the bridge that will help get them back to normal trading."

International carriers Qantas and Virgin can expect further financial support from the government running until October 31, when the government says international flights are expected to resume.

A dollar figure has not been attached to the program, which will keep 8600 international aviation employees in work, and planes in flight-ready condition.

Under the support, the government will pay for the airlines to maintain their international capability based on pre-COVID-19 levels.

Other programs are also set to be extended, including support for domestic and regional air routes, waiving aviation security charges and Airservices Australia charges at domestic airports, the business events grants program and the zoos and aquarium program.

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