Finland's Tax Administration and Estonia's Tax and Customs Board have started sharing real-time tax information.
The real-time nature of the data exchange between the Baltic neighbours aims to enhance tax control, save resources and improve services, the Finnish agency said in a statement issued on Friday.
It noted that the new arrangement marked the first time that two national tax authorities have exchanged tax data in real time, saying that other nations have previously shared that kind of information but it had been carried out manually.
"The fact that we have achieved this breakthrough with our Estonian colleagues is a result of excellent long-term cooperation. We have now created the technical solution, but the basis of this is actually built on mutual trust that has enabled us to reach a new level and together be an international forerunner," said Arto Pirinen, the Tax Administration's director of strategy.
The aim of the scheme is to improve both countries' investigations of cross-border tax violations, according to Rivo Reitmann, deputy director general of the Estonian Tax and Customs Board.
"Currently, inquiries between Estonia and Finland make up about a third of all inquiries from both countries. Real-time data exchange makes the work of both Estonian and Finnish tax administrations significantly easier and faster and is a leading example of good cooperation between tax administrations," Reitman said in the statement.
According to the administration, the arrangement will also improve services to cross-border workers, the authority said.
For example, going forward, Estonian citizens who work in Finland will not have to go to Estonian tax authorities to apply for Estonian wage certificates required by authorities in Finland.