The Morrison government has piled pressure on states to agree to a national coronavirus-hotspot definition by setting up a limited travel bubble with New Zealand.
From October 16, Kiwis will be allowed to enter NSW and the Northern Territory without having to quarantine.
Deputy Prime Minister Michael McCormack said signing up to the hotspot definition allowed those jurisdictions to be included in the deal.
He said exempting New Zealanders from mandatory two-week hotel stays would free up 325 quarantine places a week.
"This trans-Tasman bubble means that there are going to be more places open for more Australians to come home from abroad," the Nationals leader told reporters in Canberra on Friday.
Extending the bubble to Queensland would free up a further 250 hotel spots, he said.
The hotspot definition means people from New Zealand are not allowed to enter Australia if they have been anywhere which has recorded more than three cases in three days.
South Australia is likely to be the next to join the bubble when its government signs up to the hotspot definition.
Queensland and Western Australia have resisted the Commonwealth's demands, with the definition centred on triggers for opening state borders.
For Australian metropolitan areas, a hotspot is defined as having 30 cases over three consecutive days.
From November 1 Queensland will allow people from NSW to enter the state without quarantining, provided there is no further unlinked community transmission of the virus.
WA's Labor Premier Mark McGowan claims there is no economic benefit for his state to open up to South Australia and the NT, where there are no active cases.
Senior federal cabinet minister Mathias Cormann, who is a WA senator, accused Mr McGowan of running an economic protectionist argument.
"Economic state protectionism is explicitly prohibited in the Australian constitution," he told Sky News.
WA's border restrictions remain popular according to opinion polls, which have recorded massive approval ratings for Mr McGowan.
But Senator Cormann believes support will evaporate as the economic damage begins to bite and families are prevented from visiting loved ones interstate.
Tasmania is likely to open its borders to all states except Victoria from October 26.
Home Affairs Minister Peter Dutton renewed his attacks on Queensland's Labor Premier Annastacia Palaszczuk before the NSW border announcement.
Labor deputy leader Richard Marles called for the federal government to provide leadership on internal borders.
"They are on the sidelines like kids in the schoolyard yelling out 'fight, fight, fight'," he told the Nine Network.
"They are not trying to solve anything. They are just throwing rocks at it."
Victoria recorded just seven new cases of coronavirus on Friday, along with two deaths, taking the national toll to 890.
Australian Associated Press
