Prime Minister Malcolm Turnbull believes political donations should be restricted to prevent trade unions and activist groups being the real players in election campaigning.
He would ideally like to restrict donations to Australians on the electoral role and rule out corporations, trade unions and foreigners, saying the Labor Party had become just a brand to front the unions.
But Mr Turnbull told reporters in Laos on Thursday the matter raised legal and constitutional issues and would need to be examined by a parliamentary committee on electoral matters.
Opposition Leader Bill Shorten promised to introduce legislation to ban foreign donations, pleading with the prime minister to work with him.
"Mr Turnbull and I have an opportunity to restore some faith in the political process by cleaning up the overdue issue of foreign donations," he told reporters in Sydney.
