British Muslims should be asked to help draw up new anti-terror laws, according to Midland MPs.
They rejected claims Muslims were being unfairly targeted by police, but said many felt they were being victimised.
Asking Muslims to help lead the fight against terrorism could help end the " perception" they were being stigmatised, the MPs said. Far more should be done to tackle Islamaphobia, they added. The MPs warned that anti-Semitism was also on the rise.
The conclusions were included in a report by the Commons Home Affairs Committee, including John Taylor (Con Solihull), David Winnick (Lab Walsall North) and Janet Dean (Lab Burton).
It followed a controversial inquiry, in which, Police Minister Hazel Blears warned that Muslims were more likely to be investigated by police and the security services. Giving evidence to the committee, she said: "Dealing with the terrorist threat and the fact that at the moment the threat is mostly likely to come from those people associated with an extreme form of Islam, or falsely hiding behind Islam, if you like . . . inevitably means that some of our counterterrorist powers will be disproportionately experienced by people in the Muslim community."
The remarks were condemned, at the time by Muslim organisations as "scaremongering".
But publishing the full results of their inquiry today, the MPs said: "There is no doubt that the authorities face a real challenge in acting against terrorist suspects from within particular communities, without being seen as targeting - or stigmatising - that community.
"We do not believe the Government has yet found an answer to this question as the reaction to the Minister's comments illustrates." Figures showed the number of Asian people being stopped and searched by the police was "very close" to the figure it would be if everyone was treated in the same way, they said. "Nonetheless, we accept that there is a clear perception among all out Muslim witnesses that Muslims are being terrorised by the operation of the Terrorism Act - this is extremely harmful to community relations."
The Government has promised to review Britain's antiterrorism legislation, but it should involve Muslims, the MPs said. Committee chairman John Denham, a former Home Office Minister, said: "The Muslim community in Britain overwhelmingly rejects terrorism. The stereotyping of the Muslim community was rightly criticised by our inquiry."
There are 191,000 Muslims in the West Midlands, 7.5 per cent of the total population, according to the 2001 census.