Premier Will Hodgman says new legislation to penalise those who use place names not formally recognised as Tasmanian nomenclature will not extend to Aboriginal place names.
Greens leader Cassy O'Connor asked Mr Hodgman in Parliament how the proposed legislation to worked with the government's pledge to reset its relationship with the Aboriginal community.
She said Aboriginal names attached to places had been used for thousands of years.
Tasmanian Aboriginal Centre chief executive Heather Sculthorpe said the community would resist the legislation and would risk prison time if necessary.
"This bill is a direct attack on Aboriginal rights to use our own language and maintain our cultural heritage," she said.
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Mr Hodgman hosed down suggestions the use of colloquial names or Aboriginal names would attract fines up to $8400.
He said the new rules would be used as a last resort if a person deliberately misused a place name to mislead or deceive.
Warning and infringement notices for misuse of a name would be enabled through the new laws.
Ms Sculthorpe said she was sceptical about the government's response and it needed to be made clear in the legislation that the use of any Aboriginal place name would not attract sanctions.
She said the introduction of this bill was coincidental given the government's review of its dual-naming policy which was not supported by the TAC.
Under the bill, the state's Nomenclature Board would be abolished and replaced by a Place Names Advisory Panel, made up of government and community members.
The panel would provide the relevant government minister on a recommendation for a new place name for them to accept or reject.