Almost all remaining COVID-19 restrictions will be scrapped from 11:59pm Thursday, as the state approaches 90 per cent full vaccination in those aged over 12.

From Friday, double-dosed Victorians can dance in clubs, home visitor limits as well as cafe, bar and restaurant density caps will be scrapped and masks will not be required for hospitality customers.

Premier Daniel Andrews said "almost all" rules can now fall away thanks to the state's strong COVID-19 vaccine uptake.

"You will be able to go back to normal," he told reporters.

"Victoria, like perhaps no other part of the country, has earned these freedoms."

Non-essential retail will join the state's vaccinated economy, meaning only fully vaccinated people can visit those shops unless they are aged under 12 years and two months or have a valid exemption.

While masks will no longer be required for customers visiting hospitality venues, workers must continue wearing them.

Masks will not be needed in workplaces such as offices, but will be required in primary schools, health, aged care or justice settings.

They must also be worn on public transport, ride-shares or taxis, and will remain for a few more weeks in retail.

Indoor events will be allowed to host up to 30,000 punters, however one-off approval is needed to exceed that capacity.

Events held outdoors can exceed 30,000 if they publish their COVID-Safe plans, meaning the Boxing Day Test and Australian Open can proceed at full capacity subject to approval.

There are also changes to isolation rules, with people who test positive required to quarantine for 10 days instead of 14.

Positive cases will be tasked with contacting the people they saw before their diagnosis, including their workplace, school or childcare, as the health department will no longer be managing contacts.

The department can still impose quarantine periods on a case-by-case basis, but exposure sites will not be published any more.

Close contacts of confirmed cases outside their home will still need to get tested and isolate until a negative result, but are no longer required to self-quarantine.

Isolation for fully vaccinated household contacts will halve to seven days.

Acting Chief Health Officer Ben Cowie said there will be a "period of adjustment" while people get used to their new freedoms and he warned that virus transmission will continue.

"We will see ongoing transmission of the virus in the community, there will be significant cases," he said.

"But for vaccinated people, they are so much less likely to get seriously ill, to end up in hospital, to end up in intensive care, or... to lose their lives."

Victoria is now 88 per cent double-vaccinated in those aged over 12 and is expected to hit 90 per cent this weekend.

The state recorded 1007 new COVID-19 cases and 12 deaths on Thursday.

There are 337 virus patients in hospital, with 63 active COVID-19 cases in ICU, 65 have been cleared, and 34 on ventilators.

Australian Associated Press