Ministers say the proposals are in response to public concerns over the 'often devastating consequences' for victims of careless and dangerous driving.
During a consultation exercise, the Home Office sought the views of the police, judges and road safety campaigners.
If the proposals become law, courts would be told to take serious injuries caused by dangerous driving into account when sentencing offenders.
And community penalties for minor driving offences would be extended.
Home Office Minister Baroness Scotland said:
"Too many people are still killed or seriously injured as a result of dangerous, careless and illegal driving.
"These proposals seek to strike the right balance between the level of criminal culpability on the part of the bad or illegal driver, and the devastation that their action may cause."
CTC has welcomed the government's proposals, but with caveats:
Whilst all cyclists will welcome the governments willingness at last to introduce tougher sentences for bad driving offences, particularly those which cause death or injury, CTC is disappointed that the proposals are still based on maintaining the arbitrary distinction between dangerous and careless driving," said CTC campaigns and policy manager, Roger Geffen.
"CTC, together other road safety organisations, believes that the resulting courtroom semantic arguments tend to hinder (rather than help) in the administration of proper justice for road crash victims."
Organisations such as Road Peace have longed called for the greater catch-all offence of 'vehicular manslaughter'.
CTC has said it will continue to call for changes in the law on driver liability to make it easier for cyclists, and other non-motorised road users, to claim injury damages from drivers who hit them."
The government's proposals can be found here:
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