Australia might be missing out on up to $1 billion in uncollected taxes annually from Chinese agents who ship food back home to meet insatiable demand from a booming middle class.

There are 40,000 so-called Chinese 'daigou' in Australia making anywhere between $40,000 to $100,000 a year selling sought after products like baby milk formula, vitamins and organic cosmetics in China, according to industry consultants.

Most of that income earned by daigou - meaning 'buy on behalf of' in Chinese - is unlikely to be declared, said Benjamin Sun, director at consultancy ThinkChina.

"A Chinese consumer pays the daigou in renminbi. The daigou buys the product using the Australian dollar and then ship it," said Sun.