The two flags are often confused due to their similarity.
The comment comes after Peters previously criticised Australia for deporting New Zealand nationals without trial.
"When you're in a foreign country you're expected to obey their laws," he said.
"But someone should be tried before they're evicted from a country."
Last week, Peters and Justice Minister Andrew Little appeared on the ABC's Foreign Correspondent programme critical of Australia's deportation policies, saying there appeared to be a "venal, political strain" to them and "certainly not consistent with any humanitarian ideals that I thought both countries once shared".
More than one thousand New Zealanders have had their visas cancelled in Australia since stricter deportation laws were introduced four years ago.
In the same period, New Zealand has sent back only nine Australian citizens.
Australian Home Affairs Minister Peter Dutton said New Zealand needed to keep in mind the country was a buffer between themselves and boats.
"(New Zealand) don't contribute really anything to the defence effort," Dutton said last week.
"There's a lot that we do for New Zealand."
National flags
New Zealand
• adopted the flag on March 12, 1902
• features the Union Jack and four red stars with white borders
• designed by First Lieutenant of Royal Navy vessel Blanche, Albert Hastings Markham, after his submission in 1869
Australia
• adopted the flag on April 14, 1954
• features the Union Jack and Southern Cross with white stars
• followed the original design chosen in 1901 after a competition
- additional reporting Daily Mail Australia