According to a particular provision of the Austrian Income Tax Act, income received by employees from Austrian resident employers or non-resident employers having an Austrian permanent establishment is tax-exempt if the employees are performing particular activities in connection with a construction or erection project executed outside Austria. According to judgments of the Austrian Independent Board of Finance (UFS), this provision has to be applied to Austrian resident employees working for employers resident in the European Union, in the European Economic Area, and in Switzerland, as well. In a case presented by the tax office to the Austrian Supreme Administrative Court, the latter filed an appeal to the Austrian Constitutional Court to repeal this tax exemption. According to the Supreme Administrative Court, it is not reasonable anymore further to apply this provision introduced into the Income Tax Act 1972 in 1979. The Constitutional Court has already decided to examine the provision in question. Stefan Bendlinger analyses the findings of the Austrian Supreme Administrative Court and the possible impacts of a repeal on Austrian enterprises doing business abroad.