The heads of prominent Australian charities have written a letter to the Prime Minister, asking to keep their regulator.

A joint letter from the heads of RSPCA, Wesley Mission Victoria, Lifeline and the Myer Family Company and other groups saying the Australian Charities and Not-for-Profits Commission is doing a good job.

The Australian Charities and Not-for-Profits Commission (ACNC) was set up under the Rudd government to provide a one-stop-shop for determining charity status, the right to fundraise and receive certain grants.

But the ACNC is on the chopping block of deregulation, as the federal government moves to ditch everything it sees as a hindrance to business. 

"The ACNC has done what few new regulators achieve – gained widespread support across the sector it is regulating," the letter says.

Forty organisations signed the open letter to the Prime Minister, saying they “completely oppose” its efforts to shut down the regulator.

The Catholic Church is understood to support the removal of the ACNC.

The charities say that without the single government body, they would be dealing with more red tape, not less.

Federal Social Services Minister Kevin Andrews has previously said the commission is an “unnecessary and ponderous compliance burden on the sector”.

The Federal Government may be considering a replacement in the form of a website similar to CharityNavigator.org in the United States.

The staff behind the non-governmental website say it was set up to push for an official charity regulator, just like the one the Australian government is considering shutting down.

World Vision chief executive Tim Costello has told Fairfax Media outlets that the government is underestimating the charity sector, and would end up building the same regulator again with a different name.

“The charity sector isn't just a few amateurs with goodwill, who don't now need transparency and appropriate regulation. It's $100 billion, 5 per cent of GDP, it's five million volunteers,” Mr Costello said, adding that the government would soon discover it needs to “reinvent something that's pretty much the same thing” as the ACNC.