The age of criminal responsibility should be increased from 10 to 12, according to a report.
The government has been targeting young offenders with asbos
Children should only be prosecuted in exceptional circumstances, the study from the Commission on Families and the Wellbeing of Children says.
Children under 10 are deemed too young to know right from wrong and currently not held responsible for any crimes.
But the report argues children's understanding of crime may not develop until they are in their late teens.
Child psychiatrist Sir Michael Rutter, who chaired the commission, said there needed to be a clear distinction between where the child's responsibility ended and the parent's began.
It was fair to say there was an overlap, he said, but a "cut off" age to mark out that responsibility in a legal setting was necessary.
Children should be presumed innocent "unless proved otherwise" until the age of 16 in a "sliding scale" of maturity, the commission's report says.
This would "allow for the highly variable process of moral development in children", it said.
The commission also said the standard of proof for the government's anti-social behaviour orders (asbos) should be raised to the criminal standard of "beyond reasonable doubt".
The anonymity of young offenders handed asbos should be preserved, it added.
Parenting orders should be restricted to parents who have rejected supported offered to them on a voluntary basis, the report said.
And legal sanctions such as fines and imprisonment ought to be restricted to parents of children below the criminal age of responsibility.
The commission also wants a full ban on smacking be enforced, and says the current defence of "reasonable chastisement" to a charge of common assault should be abolished.
Children up to 16 should be presumed innocent, the report says
Currently, only parents who leave a mark when they smack their children can be prosecuted.
Sir Michael said evidence showed that smacking could "escalate into frank abuse" and it was wrong that adults should be more protected than children.
"Why is it all right to beat a child but not to beat another adult?", he said.
The report was welcomed by the Children Are Unbeatable alliance, which wants children "to have the same legal protection from being hit as adults".
Its spokeswoman Claire Rayner said: "This report boosts the already overwhelming pressure for the UK to satisfy its obligations under UN and European human rights treaties by ending legalised violence against children."
She said this was "vital" if we were to achieve a more respectful and "less aggressive society".
Guidelines on ages when children were too young to be left alone and a minimum babysitting age should be set by the Department for Education and Skills, the report added.
It also demanded that gaps in family services be filled as a priority.
The report also looked at families and poverty and urged the Treasury to set up an independent body to define income standards which would reflect children's right to an adequate standard of living.
Child tax benefit and the family element of the child tax credit system should be upped to average income levels, the report said.
The commission was set up by the National Family and Parenting Institute and the NCH children's family with funding from the Joseph Rowntree Foundation.