The bill, hailed as a "thunderous blow" to white supremacists when it was introduced last month, was passed in parliament on Tuesday.

It makes it a criminal offence for anyone to intentionally display the Nazi symbol in public, and those who do will face penalties of up to nearly $22,000, 12 months in jail, or both.

People will only be charged if they do not comply with a police directive to remove the symbol.

Victorian Attorney-General Jaclyn Symes said the swastika glorified one of the most hateful ideologies in history, and its public display did nothing but cause further pain and division.

"It's a proud moment to see these important laws pass with bipartisan support," she said.

"I'm glad to see that no matter what side of politics, we can agree that this vile behaviour will not be tolerated in Victoria."

Religious versions of the symbol tied to Hindu, Buddhist and Jain faiths will remain legal.

There will also be exemptions for historical, educational and artistic purposes, while memorabilia bearing the Nazi swastika can still be traded as long as the symbol is covered when on public display.

The legislation will come into effect in six months' time to allow for a campaign about the origins of the religious and cultural swastika to be rolled out, the state government said.

Australian Associated Press