The state government said the new reforms would prevent hateful conduct and address the harm it causes the community.
If the bill is passed, police will also have the power to direct a person to remove the Nazi symbol from the public, including if displayed at a march or protest.
Anyone caught breaking the rules will face penalties of more than $23,000, 12 months’ imprisonment or both.
Attorney-General Jaclyn Symes said the state had “zero tolerance for the glorification of hateful ideology”.
“We’re making sure people who use these symbols and gestures to harass, intimidate and incite hate are held accountable for their cowardly behaviour,” she said.
“While we wish making these laws wasn’t necessary, we will always tackle antisemitism, hatred and racism head-on – because all Victorians deserve to feel accepted, safe and included.”
The ban will include a broad range of symbols and gestures used by the historic Nazi Party and its paramilitary organisations, including anything which closely resembles a Nazi symbol or gesture.
Exceptions will apply if the performance or display of a Nazi symbol or gesture is done in good faith for a genuine academic, artistic, educational or scientific purpose.
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