Foreign companies that don't pay their fair share of tax could be forced to sell their Australian assets under a new federal government plan.

Requirements on foreign investment applications will ensure multinational companies investing in Australia pay tax on what they earn here.

"Where companies fail to do so I will have powers to take action, including ordering divestment of Australian assets," Treasurer Scott Morrison said in a statement on Monday.

Foreign investment applications will have to comply with Australian taxation law and tax office directions to provide information.