Mr Morrison was in Queensland on Friday touring fire-affected communities when he was asked by a reporter why questions about Ms Liu were inappropriate but his past usage of the phrase “Shanghai Sam” was not.
“Prime Minister why was it racist to question Gladys Liu’s connections to China but it wasn’t racist to call Sam Dastyari 'Shanghai Sam'?” the reporter asked.
“I didn’t use either of those phrases,” Mr Morrison responded.
Mr Morrison has repeatedly used the phrase in the past, including in 2017 when he was Treasurer.
“Under Bill Shorten, Labor is the choice of the same old self interested politics - vested interests, special deals, protecting the big unions and their big deals with big business that work against workers, machine politics, Shanghai Sam, John Setka and the CFMEU,” he told the Liberal Party’s 2017 Federal Council in Sydney.
It was also used in a tweet in 2016.
Mr Dastyari left politics in 2017 over links with Chinese donors and making statements about Australia's position on the South China Sea.
Mr Morrison later took to the airwaves to clarify he did in fact use that phrase.
“Of course I remember saying Shanghai Sam,” he told 2GB radio.
He said he thought the phrase in question was “racist”.
“I was referring to the word racist that I heard twice in the question and I've got to say my focus was on the bushfires,” Mr Morrison said.
“We were standing in the middle of an oval and your hearing doesn’t always pick up the precise wording of all the questions that comes, that’s not uncommon in circumstances like that.
Mr Morrison also doubled down in accusing Labor of attacking the broader Chinese community with its line of questioning over Ms Liu.
When pressed by 2GB presenter Ben Fordham that the attacks were not against the Chinese community but rather a single MP, Mr Morrison disagreed.
“[Labor] are only making that point about Gladys Liu,” Mr Fordham said.
“No-one’s said anything about all Chinese Australians, they said something about Gladys Liu.”
“That’s your opinion,” the prime minister replied.
“I think I made myself pretty clear yesterday people have been around politics long enough to know what the Labor party was up to and I think it speaks for itself.”