Liberal Senator James Paterson has released an alternative bill to legalise same-sex marriage that would give bakers, jewellers and florists the right to refuse to provide services for same-sex weddings.
The senator also argues it would preserve the freedoms of all Australians.
If a "yes" vote is successful, the fight for same-sex marriage will turn back to the parliament, where politicians are expected to duke it out over what exemptions should be in a bill to allow same-sex marriage.
Senator Smith's bill allows same-sex couples to Wednesday, while creating exemptions for religious organisations that would allow them to refuse to conduct same-sex marriages.
"I've never believed that allowing same-sex couples to marry needs to come at the expense of the freedoms of other Australians".
Those with the view that "gender is binary" - that people are born either a woman or a man - would also be considered to have a relevant belief which would incur the protections in the bill.
"There won't be a government position, there won't be a party position", Senator Cormann said.
But the Senator Paterson's bill goes further by allowing a whole range of individuals and companies to refuse services, without risking any breach of discrimination laws.
His bill also proposes a new section of the Marriage Act to ensure charities would not be deregistered for their beliefs on marriage.
The bill would also create a right for parents to pull their kids out of class if the content contravenes their beliefs against same-sex marriage, and sex outside of marriage.
Finance minister Mathias Cormann said that the government had no position on which bill to support, but would facilitate the debate of a private member's bill on the floor of parliament.
"As we move ... to remove one form of discrimination we want to make sure we don't put in place other forms of discrimination instead", Senator Birmingham said. Angus Taylor said the proposed religious exemptions were "very reasonable suggestions". "I don't think their votes should mean we shouldn't have same-sex marriage, but I do think that their freedoms should be protected and I think my bill is a bill that best does that".
"This is just another attempt to delay passing marriage equality".
The Equality Campaign believes the Paterson proposal is regressive and unfair.
Co-chair of Australian Marriage Equality Alex Greenwich slammed the bill as seeking to "divide Australians".
Although the result of the poll will not be binding on the government, Prime Minister Malcolm Turnbull has promised that a bill to change marriage laws will be forthcoming.