Companies tendering for public sector contracts will be excluded from bidding if they are found to be using aggressive tax avoidance schemes, the Treasury will announce today.

Treasury chief secretary Danny Alexander said that companies will be required to sign a declaration that they have not breached wide-ranging tax avoidance rules in the past 10 years before bidding for government contracts of over £2m.

The new regime will come into force on 1 April 2013 and will include 'self-certification' to ensure that companies confirm to tax rules. The historical extent must be proportionate, but the time limit has not been set. This is part of a new HMRC/Treasury consultation document, published today.

The closing date for comment on the consultation is 28 February 2013.

Alexander said: 'It is clear there has been an approach to tax which I don't consider to be acceptable, and I think most importantly, the British public don't consider to be acceptable. If you work for the government, whether you're an individual employee or a company that has got a contract with the government, you need to be behaving properly with regard to tax rules.'

The new rules will require companies to declare whether they have flouted specific bans on certain tax-avoidance schemes or have set up complex payment structures to avoid VAT.

Companies will also have to report any breach of the forthcoming General Anti-Abuse Rule (GAAR), which is targeted at artificial and abusive tax avoidance schemes.

The consultation document is available at HMRC