In an open letter, acting chief executive Kristin Stubbins said members of the company who shared Treasury's plans had betrayed "the trust placed in us".
Nine partners, including members of PwC's executive and governance boards, have been directed to go on leave immediately.
"PwC had failed in multiple ways due to a lack of confidentiality and poor governance," Ms Stubbins said on Monday.
"No amount of words can make it right. But I am fully committed to taking all necessary actions to re-earn the trust of our stakeholders.
"We understand that we betrayed the trust of our stakeholders and we apologise unreservedly.
"We know that action is critical to restore confidence in our firm and rebuild trust with our stakeholders and I am committed to taking all necessary steps to make this happen."
The consultancy firm has been under fire after it was discovered one of its former heads of tax shared confidential Treasury information about tax changes with other partners and the information was used to help win new clients.
Two independent non-executive directors have been appointed to PwC's governance board and work has begun to protect services it already provided to the federal government.
An independent report into the scandal, headed by former Telstra boss Ziggy Switkowski, will be released, but not until September.
"We recognise that enhanced governance, structures and controls are necessary and the decision to ring-fence our federal government business is a critical next step," Ms Stubbins said.
Prime Minister Anthony Albanese said the list of employees allegedly involved in the tax advice scandal should be made public and described the scandal as a terrible indictment of the firm.
"All of this should become public at the appropriate time, of course," he told Sydney radio station 2SM.
"There are investigations under way and I don't want to say anything to interfere with those processes.
"Quite clearly, what went on there is completely unacceptable."
Federal police are also investigating, following a referral by the Treasury Department.
During a Senate estimate hearing, the Greens sought to release the list of names of the employees who had leaked confidential Treasury information to clients.
But finance department officials said naming the partners involved in the tax advice scandal could disrupt the criminal investigation.
Ms Stubbins said in her letter she believed that not all persons listed in emails released by the Senate had committed wrongdoing.
"We believe that the vast majority of the recipients of these emails are neither responsible for, nor were knowingly involved in any confidentiality breach," she said.
"We have and will continue to take appropriate action against anyone who is found to have breached confidentiality or failed in their leadership duties."
Mr Albanese said it was crucial the scandal was investigated.
"In the fullness of time, of course, there needs to be proper transparency about all of this," he said.
"This is the fault of PwC. As soon as it has come to light, there are now appropriate investigations taking place."
Mr Albanese said the leak reinforced the need to bolster the federal public service.
But Greens senator Barbara Pocock said PwC's decision to stand down partners was too little, too late.
"There have been significant ethical and governance failures across the board and we need a full investigation not just into PwC but all the agencies that have played a role in this appalling chapter," she said.
"Ring-fencing government work to protect it from conflicts of interest is totally unacceptable."
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