The state government confirmed the October 23 holiday as it was announced The Gabba in Brisbane will host the grand final the following day.

"(It) means that the government can lock in ... a 'Thank You Day' for Victorians who have made so many sacrifices as part of the community effort to contain the spread of coronavirus," the government said in a statement.

It will be the first time in AFL history that the grand final has been played outside Victoria.

Grand final eve has been a holiday in Victoria since 2015 but has divided opinions, with business saying it is a hit to the local economy.

The Australian Industry Group renewed its call for the public holiday to be scrapped unless the state government can explain to businesses why it should remain for a Queensland-based decider.

"The cost of this additional holiday has been previously estimated at $1.2 billion, and such an impost would be another nail in the coffin for some businesses already half nailed shut," Ai Group's Victorian head Tim Piper said.

The state Liberal Party says the loss of the signature event is another bitter pill to swallow for the Victorian football fans and local businesses.

"This is what happens when you're the only state in a second wave," Opposition Leader Michael O'Brien told reporters.

Former premier Jeff Kennett is calling on Premier Daniel Andrews to ensure the MCG is opened up on grand final day, with the game shown on the ground's big screens for fans.

"Invite members of competing teams to attend with social distancing. Allow drinks and food to be sold. Allow many Victorians to have a fun night," he tweeted.

Under newly-negotiated contract terms with the AFL, the state government's deal to keep the grand final at the MCG was extended by one year to 2058.

The MCG first hosted the grand final in 1902 and it hasn't moved since 1991, when the match was held at Waverley Park during construction of the Great Southern Stand.

Australian Associated Press