Cigarettes could be sold only in the more expensive packs of 20 in plain packets, their corporate logos replaced with health warnings, in proposals drawn up by the Department of Health (DoH) aimed at discouraging smoking.

Anti-smoking campaigners welcomed the draft proposals – targeting the young in particular – which were published for consultation yesterday. Under the plans, designed to take the "glamour" out of smoking, the advertising of cigarette papers would be banned, while displaying cigarettes in shops would be restricted, possibly leading to their sale under the counter.

Cigarette vending machines in pubs, bars and restaurants would be either banned under the new measures, or converted to take tokens from people who had proved their age.

The proposals are part of a series of tougher measures being considered by the Government. The Health Secretary, Alan Johnson, is believed to be determined to crack down hard on smoking during his tenure at the department. According to government figures, more than 200,000 under-16s start smoking each year and are three times more likely to die of cancer than someone who starts in their mid-20s.

The Public Health Minister, Dawn Primarolo, said: "Protecting children from smoking is a government priority and taking away temptation is one way to do this. If banning brightly coloured packets, removing cigarettes from display and removing the cheap option of a pack of 10 helps save lives, then that is what we should do, but we want to hear everyone's views first.

"Smoking-related disease kills 87,000 people a year, the equivalent to the entire population of a major city such as Durham. Despite much progress over the past 10 years, with 1.9 million fewer smokers since 1998, smoking is still the biggest killer in England.

"The number of smokers is declining but we must do more to tackle a public health issue that kills 10 times more people a year in England than road traffic accidents."

The DoH has said that young people are more receptive to tobacco advertising than adults. The prominent display of cigarettes in shops – and in pubs, sometimes in specially produced vending machines made by tobacco companies – is seen as one of the few remaining "loopholes" in the promotion of smoking by the industry. Evidence suggests that such advertising could persuade existing smokers to keep smoking and young non-smokers to start.

The proposals were published ahead of a new NHS advertising campaign aimed at parents who smoke, which begins on Monday. The adverts will declare that the children of smokers are three times more likely to become smokers.

Deborah Arnott, the director of Action on Smoking and Health (Ash), said: "Smoking is a habit which is passed down from generation to generation and this pattern can only be broken by fresh thinking."