"I want to make sure that there is wide consultation and a bipartisan approach to reform in this industry," she said.

"This inquiry is an opportunity to have a committee of the parliament test ideas with the industry and to report back to the parliament and then government.

"The government had been progressing work on this matter, including developing a range of options for the future. This process allows the work undertaken to be utilised by the committee and to make sure we have all the right information in front of us."

Opposition tourism spokeswoman Libby Mettam backed the decision.

"The sector now includes operators ranging from people renting out their spare room to backpackers, to hotel chains and, as a result, the issues are complex," she said.

"While there are outstanding issues where hotels and resorts are competing with operators without the same sort of compliance burdens, we also don’t want people who are renting out their back room to have prohibitive regulatory standards imposed on them.

"We need a fairer, more level playing field, which could mean either expanding the regulatory framework or making it easier for mainstream accommodation providers.

Ms Mettam said Airbnb was a fact of life in around the world.

"It adds choice in the tourism sector and fills a gap in the market especially during special events and peak holiday periods in regional WA," she said.

But local governments were not well enough resourced to regulate the industry, she said.

"Leaving it to individual local governments would result in inconsistencies between regions and further complicate the issue," she said.

"A statewide policy needs to at a minimum ensure appropriate health and safety and noise control measures."