To me, it also implies that the person you're saying this to has just said an understatement.
For example:
A: You look like you've had a hard day at work.
B: You can say that again!
A: I bet you're excited about your holiday.
B: You can say that again!
In both instances it's as though person B is saying 'That's an understatement.' That's my feeling, anyway.