UK Labour Shadow Foreign Secretary Lisa Nandy has called for a ban on imports from illegal settlements in the West Bank if annexation goes ahead.
Nandy claimed it would be a "major step" if the British government banned imports from the illegally occupied West Bank in response to Israeli Prime Minister Benjamin Netanyahu's plans to annex the West Bank as early as Wednesday.
She said: "The proposal to unilaterally annex nearly a third of the West Bank is an illegal act which will undermine the prospect of a peaceful two-state solution for Israel and Palestine, and has serious implications for the stability of the Middle East."
"It is a shameful proposition to which the UK cannot be a silent witness. Across the world concern is growing … So far the UK government has been conspicuously absent from this global response."
She continued: "This is now urgent. The government must be clear with the Israeli coalition government that concrete action will follow, including a ban on goods entering Britain from the illegal settlements in the West Bank. This is a major step, but such a blatant breach of international law must have consequences. It will take a level of courage that so far ministers have not been willing to show."
Labour leader Sir Keir Starmer subsequently backed Nandy's proposal.
However, the UK's Board of Deputies, a body which claims to represent the entirety of the British Jewish community, branded the proposal "divisive" and cautioned Starmer to reject it.
Board of Deputies President Marie van der Zyl said: "At our meeting with Keir Starmer on 19 June, I told him that while the UK Jewish community is divided on annexation, there is far more unity on the Boycotts, Divestment and Sanctions movement."
"I would urge Sir Keir and the Labour Party not to go down this route."
Last week, the Board of Deputies accused former Shadow Education Secretary Rebecca Long-Bailey of anti-Semitism for sharing an interview with actress and Palestine activist Maxine Peake in which she spoke about Israel's role in training US police forces, resulting in her sacking.
Netanyahu plans to annex swathes of the West Bank on 1 July. The international community including the European Union and the United Nations has condemned the plans, however, the US has given Israel the green light to proceed with annexation.