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Chancellor Alexander Schallenberg said it would be compulsory to be jabbed from February 1, making Austria the first country in the world to make vaccines mandatory.
Just 66 per cent of the population is vaccinated, one of the lowest rates in the western world.
Chancellor Schallenberg said: “The most recent measures have increased daily vaccinations but not enough.
“For a long time, it was consensus in the country that a vaccine mandate is not necessary, but we have to face reality.”
Austria had imposed a lockdown on the unvaccinated in a bid to drive down cases but has said it will impose a national lockdown from Monday to get infection rates under control.
The national lockdown - for both vaccinated and unvaccinated people - would last for at least 10 days, with the possibility of extending it by a further 10 days.
Under the new lockdown, people will only be able to leave their homes for a limited number of reasons including essential shopping, to visit a doctor and to exercise.
Students will have to go back into home schooling, restaurants will be closed and cultural events will be cancelled.
Two states in Austria - Salzburg and Upper Austria - had already imposed restrictions, with the rules extended to apply to vaccinated people and a full lockdown from next week that would see schools shut and a curfew imposed.
Mr Schallenberg said the measures were being imposed because “we don’t want a fifth wave”.
The country is battling a soaring infection rate, being among one of the highest in Europe, with a seven-day incidence of 971.5 per 100,000 people - and daily cases keep setting records.
It comes as a number of its neighbours impose stricter Covid-19 measures as the continent battles a fourth wave.
Slovakia announced a lockdown for the unvaccinated to begin on Monday, while the Czech Republic has said it will limit access to a variety of services in a bid to keep case numbers down.
Germany has also announced plans to introduce restrictions for its unvaccinated population in areas with high coronavirus hospital admissions; this will see 12 out of 16 states impacted.