Victorian solarium operators will be paid $2000 to surrender their tanning beds before June 30, 2014 ahead of the state's ban on commercial sunbeds.
Health Minister David Davis said the government would collect the tanning units from operators to ensure the safe disposal of materials, including mercury in the light tubes.
Commercially operated tanning beds will be banned in Victoria from December 31, 2014.
The buyback is expected to cost between $400,000 and $750,000 but Mr Davis said he was expecting some "positive revenue" from the disposal arrangements.
"That will defray some of the costs," he said.
He emphasised the important thing was to remove the sunbeds and dispose of them safely.
"The more of these sunbeds that are not in operation at all, the better," Mr Davis said on Tuesday.
"We need a safe disposal system."
Greens MP Colleen Hartland, who last November moved the motion calling for the ban, had initially raised concerns about solarium operators flooding the private market with second-hand sunbeds.
But she believes the government's offer of $2000 per unit will be enough to discourage owners from trying to make a sale online.
"Obviously the major concern is that people will be selling them on eBay so people would be frying themselves in their garage," Ms Hartland told AAP.
The convenient disposal arrangement combined with the guaranteed payment would be a strong incentive for solarium operators to comply, she said.
The scheme has also been backed by the Cancer Council of Victoria which said the planned ban was already changing the industry.
"We've seen a huge reduction in the number of machines since legislation came in a number of years ago," Cancer Council Victoria sun smart manager Jen Makin said.
Mr Davis said the government would also provide advice on how business owners can transition away from operating commercial sun beds.
"The first announcement of this was made in 2012 so there has been significant time for the industry to adjust," he said.
Victorian operators who dispose of their tanning beds after June 30 but before December 31 will be eligible for $1000 per unit.
