This brings the number of signatories to the agreement to 104, after it passed the 100 mark earlier this month.

The document, titled the Multilateral Convention on Mutual Administrative Assistance in Tax Matters, forms the basis for administrative collaboration on tax avoidance and evasion between its signatories.

The OECD described it as the “most powerful multilateral instrument against offshore tax evasion and avoidance”, enabling countries to exchange information, conduct cooperative tax examinations and collaborate on tax collection, while protecting taxpayers’ rights.

“By signing, Pakistan will send a strong signal of its commitment” to fighting tax abuses, the OECD said.

It noted that Pakistan is also a member of a group of over 100, non-G20 countries that are collaborating on the implementation of the OECD’s project to overhaul the international corporate tax system, known as the Base Erosion and Profit Shifting (BEPS) package.

This means that as of next year or the year after, Pakistan will begin exchanging tax information automatically with other participating jurisdictions – a key part of the BEPS project.

“The convention provides the ideal instrument to swiftly implement automatic exchange, so the signing and ratification of the convention is very timely,” the OECD said.