Tory MP Jonathan Sayeed faces a two-week suspension from the Commons.
Mr Sayeed has had the Tory party whip withdrawn for a month
The recommendation from the Standards and Privileges Committee follows an inquiry into claims he was paid for tours around the Palace of Westminster.
The MPs said his conduct "has fallen well below the standards" expected and risked harming its reputation.
Mr Sayeed denies the claims and said the suspension was "unjust and wrong". Michael Howard has also suspended him from the Tory group of MPs for a month.
The Commons is expected to vote on the committee's recommendation on Tuesday.
The MP could now face a deselection bid after his Mid-Bedfordshire constituency association called a special meeting for 17 February.
Association chairman Ashley Green told BBC News: "We will be considering Mr Sayeed's future."
The inquiry was sparked after allegations in The Sunday Times claimed "The English Manner Ltd charges clients up to £500 per day for access to the Palace of Westminster through Jonathan Sayeed" - a charge rejected by the MP.
The firm, which organises luxury holidays in Britain for rich Americans, was set up by Mr Sayeed and his Commons assistant.
Mr Sayeed was accused of abusing his position as an MP by entertaining customers in the Commons.
The committee concluded there was no evidence that he had directly received fees for hosting them in the House.
But, both Mr Sayeed and his assistant Alexandra Messervy were "at the least negligent in failing to exercise sufficient care to safeguard the reputation of Parliament", the MPs said, "and at worst have acted carelessly, in a manner which has allowed that reputation to be injured".
Mr Sayeed, 56, said: "I have never used my access to the House or its facilities for commercial gain, neither has The English Manner - it has never charged any client any amount at any time for access to the Palace of Westminster.
"I have never solicited or received any payment for any tour or entertainment within the Palace of Westminster.
"The evidence, agreed by the Parliamentary Commissioner and accepted by the committee confirms both these points."
He added: "The facts refute the complaint - to impose a penalty it is unjust and wrong."
But following the inquiry, Tory leader Michael Howard ordered Mr Sayeed to be suspended from the party whip for a month for his "completely unacceptable" behaviour.
In a statement, Mr Howard said he had reached the decision after hearing conclusions from Parliamentary Commissioner Sir Philip Mawer's inquiry.
"Such behaviour in a Conservative Member of Parliament is completely unacceptable and I condemn it without hesitation," said Mr Howard.
"Because of the serious nature of these findings, I have asked my Chief Whip to take immediate disciplinary action against Jonathan Sayeed.
"The Chief Whip has accordingly suspended the Conservative whip from Mr Sayeed for the period of a month until Monday 7th March."
Mr Sayeed has been MP for Mid-Bedfordshire since 1997.