Drawings and computer-generated images of child sex abuse would be made illegal under proposals announced by Justice Minister Maria Eagle.
Owners of such images would face up to three years in prison under the plans.
The Obscene Publications Act makes it illegal to possess photos of child abuse but it is legal to own drawings and computer-generated images.
Ms Eagle said the proposed move would "help close a loophole that we believe paedophiles are using".
The plans are part of the government's response to a public consultation exercise carried out last year.
The government has acknowledged that paedophiles may be circumventing the law by using computer technology to manipulate real photographs or videos of abuse into drawings or cartoons.
A Ministry of Justice spokeswoman said the authorities had "noticed an increase in the existing availability of these images on the internet".
She said: "If we do not address the issues these images raise now it is likely their availability will continue to grow.
"They are often advertised as a legitimate depiction of child sexual abuse."
Which in theory would mean, any Hentai or anime that shows abuse of a sexual nature to minors would be illegal
While i agree with the concept, it's no secret that hentai and dojins are a big part of the anime business in Japan (i even read a report that it may be bigger than the actual anime business itself)
When you think about how many big animes now are comming from h-games (Air, Shuffle! Kanon), Even shows like Elfen Lied and Negima are on the borderline of this, so surely this is going to cause atleast a minimal impact on anime in the UK