Well, if you buy a property worth more than $2.5 million from a foreign resident then that is exactly what you will have to be if a Treasury proposal is adopted.

Treasury says it would like Australians to withhold 10 per cent of the sale price of a property from foreign residents and hand that money to the Australian Tax Office.

The measure will be a "collection mechanism" for the ATO to support the operation of the foreign resident capital gains tax regime.

And it will be up to you to establish whether the person you are buying the property from is a foreign resident and whether the transaction involves "Australian taxable property."

Your decision may involve "making some enquiries in certain circumstances," Treasury says.

And penalties may apply if you fail to do it.

The measure was announced in the former Labor government's 2013-14 budget. In November last year the Abbott government said it would proceed with the plan.

It means that from July 1, 2016, a 10 per cent non-final withholding tax will apply to the sale, by foreign residents, of some properties worth more than $2.5 million. It means local buyers will have to become tax collectors and wrap their heads around complex tax rules to figure out whether they are buying relevant property from a foreign resident or not.

Treasury says the federal government says it welcome foreign investment in Australia, but sometimes foreigners will not pay the tax they are supposed to.

"There can be difficulties in collecting tax from foreign resident taxpayers," a Treasury discussion paper says.

"This usually occurs where no tax return has been lodged and the taxpayer has little or no other connection to Australia."

The plan is supposed to capture some of the revenue that is missed when foreign residents fail to pay the capital gains tax they owe after selling a property.

To reduce compliance costs, the proposed "withholding tax" will not apply to transactions of  residential property worth less than $2.5 million, but that exemption is not intended to cover vacant land.

Treasury's proposal can be found in a discussion paper, released last week, called "Non-final withholding tax on transactions involving Australian property."

It includes details of the proposed design for implementing the regime. It also discusses when it may be too difficult for a 10 per cent tax to be withheld.

Australia's current foreign resident capital gains tax regime was introduced in 2006, replacing the rules that had applied from 1985 when CGT began.

Under the present regime, foreign residents disregard a capital gain or a capital loss from a CGT event unless that event happens to an asset that is "Australian taxable property."