The banks are steeling themselves for tougher rules on the exit fees they charge on mortgages.

While the Government and Opposition slug it out on stronger competition in the sector, Labor is trying to get out in front with a crackdown on what it calls unfair mortgage exit fees that keep people bound to their banks.

The big banks continue to demand up to $900 from borrowers wishing to switch their home loan within the first four years.

New rules to force banks to lower their fees for people wanting to switch will be released this week by the Government and could see banks taken to court for charging the fees.

As public frustration with banks grows, both sides of politics have promised to improve competition in the banking sector.

Prime Minister Julia Gillard has told Channel Nine the measures will make it easier for people to switch mortgages.

"That package is about cracking down on unfair mortgage exit fees - the things that keep people bound into their banks even though they want to change because they want to shop around and get a better deal," she said.

But Opposition Leader Tony Abbott says any reforms are useless without more competition in the banking sector.

"[The reforms are] interesting but this is something they talked about in 2009 but never did anything with," he said.

"This is a Government which has been all talk and no action, all bluster and no impact when it comes to the banks.

"Unless the banks are truly competing, making it easier to change from one identical loan to another identical loan isn't necessarily such a great outcome."

But Stephen Munchenberg, the chief executive of the Australian Bankers' Association, says any changes may mean higher fees are charged elsewhere to recover costs.

He says there is no evidence that lowering exit fees will lead to more banking sector competition.

"We're seeing a lot of assertions about banks from a whole range of people at the moment that aren't backed up by any evidence," he said.

The Coalition has a private members' bill that would give the Australian Competition and Consumer Commission more power to stamp out anti-competitive behaviour.

The bill will be introduced into Parliament by Opposition treasury spokesman Joe Hockey in the next sitting, which begins on November 15.

The Government has been under pressure to act following the Commonwealth Bank's decision to raise rates by 45 basis points on Melbourne Cup day.

Westpac, ANZ and NAB are expected to announce increases of their own this week.

Meanwhile, it has been reported the banks are seeking changes to tax laws to save them from paying hundreds of millions of dollars in tax when new global capital and liquidity requirements come into place.

The Consumer Action Law Centre's director of policy, Nicole Rich, says the banks may just have to wear the cost.

"These new rules are going to affect everybody, and, in fact, they're really for the community's benefit so we'd really hate to see the banks offset that with some tax cuts that might not be necessary," she said.