There will be a legal requirement for anyone in regulated activity relating to children in England, including teachers or healthcare professionals, to report it if they know a child is being sexually abused.
The home secretary says children will be better protected from sexual predators under plans being brought forward.
Those who fail to report child sexual abuse they are aware of, falling short of their legal duties, face being barred from working with young people.
Anyone who actively protects child sexual abusers – by intentionally blocking others from reporting or covering up the crime – could go to prison for seven years.
James Cleverly, home secretary, said: "There is no excuse for turning a blind eye to a child’s pain."
He added: "Having listened to the voices of victims and survivors and reviewed the work of the Independent Inquiry into Child Sexual Abuse, we are working at pace to get a mandatory reporting duty for child sexual abuse onto the statute book."
Cleverly also said that the police will be equipped with more powers to prevent those who have committed "abhorrent sexual crimes in the past" from evading the police by changing their name.
By making mandatory reporting a legal requirement, the government says they are delivering on a key recommendation in the Independent Inquiry into Child Sexual Abuse (IICSA) report to protect children from harm and make sure authorities never again turn a blind eye to this kind of devastating crime.
In a move to further protect people from sexual predators, the police are being given greater powers to stop registered sex offenders from changing their name if they think they still pose a risk to their communities.