More of the nearly $100 billion paid annually in federal contracts could stay onshore as Australian companies get a leg-up on foreign competition.

Finance Minister Katy Gallagher says the value of contracts only available to local companies will be increased for the first time in more than two decades.

For non-construction contracts, the Australian-only tender threshold will be lifted from $80,000 to $125,000 from November 17.

The construction contract threshold will remain at $7.5 million.

"We wanted to maximise the opportunities that come for Australian businesses ... drive better bang for our buck," Senator Gallagher said on Wednesday.

More than 83,000 contracts worth $99.58 billion were published on the government's tendering database in 2023/24, the finance department says .

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