All food certified as halal should be labelled as such when sold in Australia and the halal industry should establish a single certifying authority and trademark to counter consumer mistrust, a Senate committee has recommended.

Regulation of halal in the domestic market was lacklustre, according to the report of the Economics References Committee, which said it had heard "credible reports suggesting that the lack of regulation has been unscrupulously exploited".

In tabling the report in the Senate, committee chairman Sam Dastyari went further, claiming: "Some certifiers are nothing more than scammers."

"This has undermined public confidence and, in the committee's view, amplified the perceived seriousness of any shortcomings that may exist," he said.

"It is an inescapable fact that halal certification is poorly understood, and arguably under-regulated, certainly in the domestic market. This compromises the integrity of the system and has allowed questionable conduct by certifiers of questionable expertise, and questionable intent."

The Economics References Committee has asked the Turnbull government to consider extending its oversight of halal-certified export meat to all halal goods sold in the domestic market.

The inquiry, whose creation was driven by Liberal Senator Cory Bernardi, considered kosher and organic certification.

It recommended all meat sourced from animals subjected to religious slaughter should be labelled as such.

Currently, meat that is certified halal for key export markets can turn up for sale in butchers and supermarkets without any labelling to show it is halal.

Anti-halal campaigners who described it as a "religious tax" that funds the promotion and spread of Islam deluged the inquiry with more than 1400 submissions, many calling for halal to be banned.

The committee, which heard from representatives of the anti-money laundering and counter-terrorism financing agency AUSTRAC (Australian Transaction Reports and Analysis Centre), did not find any basis for claims that halal funds terrorism overseas.

But Senator Bernardi said in additional comments to the report that AUSTRAC had conceded in evidence that it had not actually investigated whether a direct link existed.

"They are making a statement about something they haven't even investigated," he said.

Senator Bernardi was critical of the many halal certifiers, with the exception of the Australian Federation of Islamic Councils, which refused to engage with the inquiry.

The committee criticised the "vitriolic nature" of many of the published submissions by the public, saying a "pronounced anti-Islamic tenor permeated a regrettably large proportion" of them.

The push for clearer labelling is likely to disappoint the Australian Food and Grocery Council, which has said the decision should be up to food producers.

"It is the manufacturer who pays for third party certification of food and who should therefore be free to decide when and how that certification is to be used," the council said in its submission.

"A further consideration is that labelling is a costly exercise with long lead times."

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