The agreement on information, brokered by the Paris-based Organization for Economic Cooperation and Development and the Council of Europe, concerns non-residents with assets in the country.
In a statement, the government said it was committed to complying with international standards on tax issues.
"The signing of the OECD/Council of Europe convention underscores Switzerland's willingness to conform to these standards," the government said.
"It also confirms Switzerland's commitment to the global fight against tax fraud and tax evasion with a view to safeguarding the integrity and reputation of the country's financial centre."
A cabinet meeting mandated Finance Minister Eveline Widmer-Schlumpf to prepare a draft law that would enable the country to sign the accord, which has already been signed by 50 nations and is in force in 30 of them.
The accord, drawn up by the OECD and the Strasbourg-headquartered Council of Europe — which is separate from the European Union — sets down ways for governments to cooperate in order to fix and levy taxes on non-residents.
The automatic exchange of information about non-residents, a particularly controversial area given Switzerland's trademark banking secrecy, is one of the options available in the accord.
But additional deals between individual signatory countries are required for such a measure to be applied.
With the financial crisis raising the stakes in the debate over offshore tax havens, Switzerland has opted to give ground in some areas in order to defend the overall principle of banking secrecy.
For example, Switzerland taxes the accounts of non-resident European Union citizens who have money in the country, and then transfers the cash to the individual's homeland without revealing their names.
In a related decision on Wednesday, the Swiss government also drew up a mandate for talks with the EU, which wants to update the current rules.
Switzerland taxes the savings of such depositors at a rate of 35 percent — raised from the original 20 percent in 2011 — and pays the funds anonymously back to member states.
Only interest in the narrowest sense is taxed, but Brussels wants to widen the net to cover dividends from shares and life insurance policies, as well as capital gains from the sale of shares and real estate.
Switzerland, which is not a member of the 28-nation EU, is surrounded by the bloc's members and has tight economic ties with them.
Switzerland has insisted that all the globe's offshore havens — for example, Britain's various Caribbean territories — must also fall into line to ensure a level playing field.