The new draft, which is partly aimed at tackling Islamist radicalism, forbids any foreign funding. But Austria's official Islamic Community says it reflects a widespread mistrust of Muslims and fails to treat them equally.
Islam has been an official religion in Austria since 1912. The Islam law, the "Islamgesetz", was brought in by the Habsburg Emperor Franz Joseph, after Austria's annexation of Bosnia-Herzegovina.
Under the law, Muslims, like Catholics, Jews and Protestants, are guaranteed wide-ranging rights, including religious education in state schools.
.... After more than 100 years, most agree that the Islam law needs to be updated to reflect the realities of modern Austria.
But some parts of the government's draft legislation have caused controversy, in particular a proposed ban on any foreign funding for mosques or imams. [BBC] Read more