1.1 Legal Framework
According to Sec. 48 of the Federal Fiscal Code (Bundesabgabenordnung – „BAO“), the Federal Minister of Finance can decide to exempt certain income of persons who are subject to unlimited tax liability, or to credit foreign tax against the income tax liability of such persons if they are subject to tax in more than one country, to the extent that this is necessary to equalize the foreign and the domestic taxation or to achieve the goal of reciprocity.
