Labour could be forced to introduce new driving laws preventing thousands of motorists from using a loophole to avoid penalties.
Ghost number plates have been growing in popularity across the UK, with drivers using them to avoid paying penalties for speeding as well as breaking other traffic rules.
The plates have a reflective coating, which makes them hard to read when caught on cameras and have often been used in criminal activities.
Labour has now been pressured to take urgent action against offenders caught with the illegal plates, which could see motorists face tougher punishments.
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The new rules would make it tougher for drivers to use ghost plates in the UK
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The British Number Plate Manufacturers Association, which represents the vast majority of manufacturers of licence plates in the UK, has called for tougher regulation to be introduced.
The association’s chairman, Michael Flanagan, said: "Far from being the tightly regulated industry it should be, number plates are increasingly being sold by unscrupulous below-the-radar suppliers using non-compliant, untraceable materials.
"They rarely ask for the documentation that the DVLA requires. This is a criminal offence and enables serious criminals and terrorists to move around the roads undetected. Motorists deserve to know they are buying a legal, compliant number plate from a legitimate supplier. Now is the time for the Government to tighten the regulations."
Writing to the Government, the association warned that a number of suppliers of number plates have failed to register with the DVLA, making them illegal providers.
Ghost number plates are harder to read by Automatic Number Plate Recognition cameras
GETTYSince they are not registered with the official body, there has been a rise in the number of ghost plates and cloning cases, which is when alicence plate is fraudulently put on another vehicle.
Earlier this year, Sarah Coombes, Labour MP for West Bromwich, introduced the Vehicle Registration Offences Review Bill, which would make the penalties for drivers caught with ghost plates stricter.
The Bill calls for the penalty for being caught with a ghost plate to be raised from a £100 fine to at least £1,000, as well as six penalty points on a driving licence.
Coombes said: "Dodgy number plates are no longer a fringe issue. They’re everywhere, and they’re undermining the rule of law on our roads. I know this Government is committed to making our roads safer for everyone. Tightening the law on number plates will be a huge step in the right direction."
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In response to the suggested regulation changes, a DVLA spokesperson explained that the agency is committed to ensuring all number plates are displayed correctly and legally.
The spokesperson said: "We work with the police and Trading Standards to take action against suppliers who do not comply with the law.
"A legitimate supplier will always ask to see ID and entitlement documents before selling a number plate. Where this doesn’t happen, members of the public can report this directly to their local Trading Standards."
Meanwhile, the RAC's head of policy, Simon Williams, warned that due to the "proliferation" of Automatic Number Plate Recognition cameras used for enforcement, "it simply isn’t right that criminals can get away with these offences by easily purchasing illegal ghost plates".
The Vehicle Registration Offences Review Bill has called for tougher penalties for drivers caught with ghost plates
GETTYHe said that alongside cloned number plates, "it’s apparent these are serious and growing problems that need solutions".
In a written submission to the Department for Transport in April, Coombes asked the authority to make an estimate on the number of taxis and private hire vehicles that use ghost plates.
In response, Transport Minister Simon Lightwood detailed how the DVLA is working with the National Police Chiefs’ Council and Trading Standards to crack down on the use of illegal number plates as well as number plates with raised characters, commonly known as "4D plates".
He added: "Work is currently ongoing to quantify the number of illegal plates that may be in circulation, which would include on taxis and private hire vehicles."
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