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The OECD on Sunday delivered a new global standard to crack down on tax evasion with more than 40 countries already committing to measures which the European Commission called "a big step" forward.
Organisation for Economic Cooperation and Development (OECD) chief Angel Gurria called it "a real game-changer" that would strengthen international cooperation to catch cheats.
"Globalisation of the world's financial system has made it increasingly simple for people to make, hold and manage investments outside their country of residence," he said.
"This new standard on automatic exchange of information will ramp up international tax cooperation, putting governments back on a more even footing as they seek to protect the integrity of their tax systems and fight tax evasion."
Offshore tax evasion remains a serious problem worldwide, with vast amounts of funds deposited abroad and sheltered from tax collectors in their home countries.
As an example, the OECD said profits from US companies held offshore amounted to US$2.0 trillion, while the tiny British Virgin Islands -- a tax haven -- is now one of the top five investors in Russia and China.
OECD tax director Pascal Saint-Amans said G20 finance ministers, meeting in Sydney, were also working on standardising the rules governing where the profits of multinationals should be taxed.
It comes as concern mounts that companies, particularly those involved in the digital and Internet sectors, can reduce their tax bills by shifting profits around the world to areas where rates are lowest.
Ahead of the Sydney meeting, IMF chief Christine Lagarde said accounting for revenues from global digitised businesses like Google and Apple was a "big ongoing problem and process".
- Closing down loopholes -
She urged governments to radically rethink international tax arrangements to deal with it.
"The political message is we are closing down all the loopholes," Saint-Amans said.
"If taxpayers don't have trust in the fairness of the tax system, then the level of compliance drops."
The OECD will present its report looking at the increasingly digitalised global environment to another G20 meeting in Cairns, in northern Australia, in September.
G20 ministers asked the OECD to examine the issues as a way to inject more trust and fairness into the international tax system.
On Sunday, they formally endorsed the single global standard for the automatic exchange of information between tax authorities worldwide.
The measures proposed involve countries obtaining information from their financial institutions and exchanging the details automatically with other jurisdictions every year.
The OECD said the standard sets out the financial account information to be exchanged, the institutions that need to report, the different types of accounts and taxpayers covered and common due diligence procedures.
"I want to underline the importance of the big step achieved concerning the fight against tax evasion," European Commission vice president Olli Rehn said in welcoming the common standard.
Current G20 president Australian Treasurer Joe Hockey conceded that the new standard was not a silver bullet, but said G20 nations were "absolutely determined to get real action" on the issue.
"There was unanimous agreement around the room that we're not arguing about who gets what share of tax, we're arguing that companies should pay tax. This goes to the heart of the sustainability of issues like free trade and open commerce," he said.
Ahead of the Sydney meeting, US Treasury Secretary Jacob Lew described tax reform as among the group's most crucial initiatives and backed the need for greater harmonisation.
"Automatic exchange of information has quickly become the new global standard, and I believe that the G20 should continue to provide its full support and encourage all nations to adopt the standard," he said on Friday.
The new standard was drawn up on the back of progress made on tax-dodging within the European Union and ongoing efforts to reinforce global anti-money laundering standards.
So far 42 countries have committed to early adoption of the OECD standard.