Opposition Leader Bill Shorten is promising exemptions from the new scheme for major industries like steel and agriculture.

Labor's climate policy extends the coalition's "safeguard mechanism" that limits pollution by big industries.

"There will be no carbon tax, carbon pricing mechanism, or government revenue," Mr Shorten said.

The government immediately attacked Labor's policy even though it is based on the coalition's own system.

"Bill Shorten does not have a plan, he just has a tax," Prime Minister Scott Morrison repeatedly told reporters in Canberra on Monday.

Nationals leader Michael McCormack claimed agriculture would "almost be shut down".

"The diesel fuel rebate will have to go under Labor's policies. You won't be able to grow cotton or rice under Labor's policies. You won't be able to irrigate under Labor's policies," he told reporters.

And Finance Minister Mathias Cormann took aim at the plan to allow businesses to trade on international carbon markets, saying: "It clearly is a carbon tax."

Opposition climate change spokesman Mark Butler said that was rubbish.

"We allow business to trade in every other robust international market, why on earth would we not allow them to trade in international carbon markets - provided, of course that they're robust and they're credible," he said.

"What we need is cuts in pollution. Whether they are from the Australian carbon farming sector or overseas robust credible markets or the electricity sector, the important thing is for cuts in pollution to be achieved."

Business across the board told Labor they wanted to expand the safeguard mechanism rather than start from scratch.

The mechanism, which currently applies to 140 companies, sets a baseline of emissions for businesses.

If they pollute more than that they must buy offset credits to surrender to government.

Some big polluters had their baseline set above their worst polluting days, meaning the limit effectively allowed them to increase emissions.

Only a handful of companies have exceeded their existing limits and the government made changes in 2018 that allows the baseline to be moved higher if a business expands production.

Mr Butler said Labor would significantly expand the range of ways to offset emissions, including again allowing access to international markets after the coalition under Tony Abbott banned the practice.

This would lead to businesses being able to choose the most efficient and cost-effective manner to offset emissions, and would also let them sell their own credits if they cut pollution below their baseline, he said.

Last year, the businesses already covered by the safeguard mechanism surrendered about 450,000 permits, with some having to buy carbon farming offsets at $12-15 a tonne - more expensive than international credits.

Labor also confirmed it will not use carbon credits from the earlier Kyoto climate agreement to meet Australia's targets under the Paris agreement.

Agriculture and electricity generators will not be covered by the expanded safeguard mechanism.

A $300 million fund will help trade-exposed industries like steel, aluminium and cement manufacturing to remain internationally competitive.

Labor will also set a national electric vehicle target of 50 per cent of new car sales by 2030, as Australia lags behind other developed nations in adopting the new models.

Australian Associated Press