Mr Dutton reportedly made the suggestion last year, but the proposal was knocked back by prime minister Malcolm Turnbull and treasurer Scott Morrison.
SBS New has contacted Mr Dutton’s office for comment.
Australia’s rate of permanent migration has been capped at 190,000 since 2011.
The number does not include temporary workers and students, but is made up of skilled work visas and family visas, with a smaller portion of humanitarian refugee visas.
The cap is usually met, but in the most recent year, 2016-17, only 183,000 migrants settled in Australia.
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Mr Dutton’s alleged proposal is much more moderate than former prime minister to cut the rate by 80,000 down to 110,000 places per year.
Mr Morrison publically rejected the suggestion at the time, arguing a cut of that size would reduce the tax intake to the federal budget by $4 or $5 billion.
"People who come as skilled migrants pay taxes," the treasurer said in February.
"They actually make a net contribution to the economy."
Mr Dutton recently told Sky News he understood people were concerned about population pressures in the cities, but was "not proposing to cut the numbers".
