How do you figure that? The reason why the person was nailed with taxes upon his return to Austria was that the government was not able (or willing) to track him down when he was abroad, but once back in Austria he was an easy target–and he was taxed on his estimated income for the past period when he was not a resident of Austria!
This is not simply an anecdote, as the Austrian consulate confirmed the possibility of such an event when I called them. But in any case, the Austrian laws appear to be less strict than the US concerning taxation of citizens, because the Austrians don’t automatically tax citizenship (there are variables to be considered first).
A simple reading of this thread will demonstrate that Dexter and I have both been saying a good deal more than your statement implies, and frequently the point has not even been about the difficulty of handling the “big picture” in a short essay. But that is a point we agree on.
a) How do you know why the Austrian government didn’t ask him to pay taxes while he was abroad? Another explanation (which seems more likely) is that there is no provision for the government taxing people who are out of the country. I knew someone from Austria who lived outside her home country, and registered with the consulate in the country in which she resided. She told me that the consulate never mentioned paying taxes (even though she mentioned that she was gainfully employed.) If she never returned to become a resident of Austria she presumably would never have paid Austrian taxes.
b) I did not use the word “anecdote” to mean “false statement” as you seem to believe.
Sorry Arnold, I didn’t mean to imply you were attacking my anecdote, I simply wanted to clarify that I am relying on more evidence than an anecdote for this bizarre situation.
I believe I have identified at least two instances when Austria is able to tax its citizens who live and work abroad, which may explain the differences in cases between your friend and my friend:
when employed or dispatched by an Austrian company
if the person in question is an entrepreneur (essentially working for himself)
To be considered along with the above list are the tax treaties Austria has with specific countries (in order to avoid double-taxation or even to nail the entrepeneurs making lots of money I guess).
One of the things that might be making the “Austria anecdote” difficult to analyze is what the country’s definition of “resident” is.
For example, Canada does not tax non-resident citizens. However being a “non-resident” for tax purposes in a given year is not a completely trivial thing to be. If you maintain a household, real property, or other financial or family ties to Canada while not actually being in Canada you might not qualify as a “non-resident”. Basically the country doesn’t want there to be an easy loophole for people to avoid paying taxes - they want to get their hands on your money.
Thus (for Canada at least), non-residents do not pay taxes on non-Canadian sourced income, and do not even have to file papers, provided they past the non-resident “test”. The US is pretty much unique in that all citizens, regardless of residency, must file tax papers on their entire “world income”, though much non-USA source income for non-USA-resident citizens ends up being exculed via various tax laws and treaties.
For me, the most bothersome thing is the legal requirement to file the forms - the various treaties and exculsions result in minimal increased tax burden, but the paperwork and time burden is significant.