The state opposition has pledged $103 million in funding over the coming four years if it can win the upcoming state election.
The party claims the current government has presided over half the state's music venues closing.
After the COVID-19 pandemic and harsh restrictions on venues in Sydney and Newcastle, only 133 music venues remain in the state, NSW Labor said.
Controversial lockout laws, including 1.30am "lockouts" and drink restrictions were imposed across Sydney in 2014 in response to a spate of alcohol-fuelled violence, but were repealed in 2020.
"We want to set up our state for the long term, backing the jobs of the future in our creative sectors," NSW Labor Leader Chris Minns said
Sound complaint processes, also blamed for a series of high profile venue closures across Sydney, will be streamlined under Labor's plan, with the party claiming seven agencies are currently responsible for noise complaints.
"After 12 years of lockouts and lockdowns this is the moment when music in NSW can reach its potential," Shadow Minister for Customer Service & Digital Yasmin Catley said on Wednesday.
"Most of the industry is based here, but we need to back our grassroots venues as well as festivals and artists for it to succeed."
Funds will go towards creating a new music-boosting body Sound NSW, which would support local musicians in a similar way Screen NSW champions local film.
The music body will be tasked with developing a decade-long Contemporary Music Strategy, mirroring plans already in place in Victoria, South Australia, Western Australia, Queensland and Tasmania, Labor said.
The body will also be responsible for prioritising funding, and will be tasked with boosting opportunities for Indigenous artists, and building skills for technical workers and producers within the industry.
The party also plans to reform planning laws it says will protect existing venues, and produce new places for live music.
Further reforms include minimum $250 musician fees for artists when taxpayers funds are used for an event, and empowering the state's 24-hour Economy Commissioner to a statutory appointment, and expanding his powers into Newcastle, the Central Coast and Wollongong.
The party will also provide up to $250,000 for councils to create a business case to consider creating permanent music festival infrastructure, in areas including central Sydney, Parramatta, western Sydney and regional NSW.
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