Action on Smoking and Health, which has been pushing for the ban, has welcomed the consultation and says it brings the new rule closer.
Youngsters in vehicles where people light up are subjected to a damaging amount of poisonous gasses via passive smoking, the group says.
Secondhand smoke 'a substantial threat'
Chief executive Deborah Arnott says: "Cars are small tin boxes where concentrations of tobacco smoke can reach dangerous levels very quickly."
Her organisation wants the new law brought in before the general election next year. It would only cover England and stop anyone smoking if someone under 18 years old is in the vehicle.
The move to protect children from second-hand smoke could be enacted as part of an Act on families after MPs voted for that in February.
The consultation is under way now and will last six weeks. "Second-hand smoke is a real and substantial threat to child health," the consultation document states.
"Today, many children in England report being exposed to second-hand smoke in private vehicles, including the family car."
Anti-smoking laws popular with public
It says the aims of the proposed rules on smoking in vehicles carrying children would be to:
- protect children from the health harms associated with exposure to second-hand smoke in private vehicles;
- encourage action by smokers to protect children from second-hand smoke;
- and in time, lead to a reduction in health conditions in children caused by exposure to second-hand smoke.
"The purpose of this consultation is to seek views on draft regulations before they are made," the document says.
Ms Arnott adds: "As David Cameron himself has said, the time has come for it to be illegal to make children breathe in these toxic fumes.
Laws stopping smoking in cars with children are popular with the public, with parliament and with children and we urge the Government to bring them into force before the next election."
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