Smokers will soon be banned from lighting up in outdoor dining areas – including beer gardens, cafes, and takeaway shops – under a state government plan to make eateries cigarette-free.

After years of lagging behind other states, Victorians will no longer be able to smoke in outdoor venues where food is served, with fines of up to $758 for people who breach the new rules.

Illustration: Matt Golding

The Andrews government will unveil the policy on Sunday, placing Labor on a potential collision course with pubs and restaurants who fear the move could be detrimental to trade.

But in a bid to soften the blow, the changes will not be implemented until August 1, 2017, providing businesses with almost two years to raise any concerns and get used to the proposed reforms.