Liberal Senator James Paterson has dropped amendments that would allow bakers and florists to refuse to participate in same-sex weddings.
The Senate is debating the details of the bill to legalise same-sex marriage, including a proposed amendment that would allow civil celebrants to refuse their services to same-sex couples.
While the Dean Smith bill already allows priests and other religious celebrants to refuse on the basis of their faith, a number of senators want the protection extended to civil celebrants with a "conscientious objection".
Libertarian independent David Leyonhjelm, the One Nation team and various Coalition senators – including James Paterson, George Brandis and Matt Canavan – have all raised competing amendments designed to extend the right to refuse to all marriage celebrants.
Senator Paterson said those with "secular or cultural reasons" to oppose same-sex marriage should be given equal protections and it would be "equally wrong" to force them to act against their beliefs.
The bulk of Senator Paterson’s amendments were voted down on Tuesday afternoon, 41 votes to 24.
But those amendments also included a controversial line to keep the original "man and a woman" definition of marriage as well as adding a definition for same-sex couples.
Senator Leyonhjelm said he wanted civil celebrants to have the power to choose to refuse anyone, including allowing gay celebrants to refuse heterosexual couples.
"People who are not religious should not be treated as second-class citizens," he said.
Finance Minister Mathias Cormann also indicated his support.
But Senator Smith, the main Liberal sponsor of the bill, said allowing conscientious objection was a serious step that should not be taken lightly.
"The place of a civil celebrant in our country is clear. It should perform the function of the law," Senator Smith said.
Labor’s Penny Wong agreed the amendments were an "unorthodox" and "illiberal" step.
"Universality in the application of the secular law should not apply on the basis of this new notion – and it is a new notion in Australian law – of conscientious objection," Senator Wong said.
Greens Senator Janet Rice also opposed the amendments, arguing civil celebrants "perform a function on behalf of the state".
The Senate will likely spend another day or two debating various amendments.
Some of the others proposed by Senator Paterson include protecting anyone voicing the "traditional" view of marriage from any unfavourable treatment, while another would specifically shield religious charities.