According to the contentious draft legislation, those granted asylum will be reassessed after three years. If their countries of origin are then deemed to have become safe, they will be sent back.
Those under "subsidiary protection" -- a kind of asylum-lite awarded in particular to Afghans -- will meanwhile only be allowed to be joined by family members after three years, up from one year now.
Chancellor Werner Faymann said that the legislation, due to go before parliament in December, is a "signal that asylum is something which is temporary", and aimed at deterring people from coming to Austria.
Rights groups however sharply criticised the proposals, saying that they would make the integration of migrants into Austrian society more difficult.
The UN refugee agency, the UNHCR, said that the tightening of rules on relatives coming to Austria "could keep families apart for many years, if not for ever."
Austria has seen some 400,000 migrants enter the country since September, most of whom travel onwards to Germany or Scandinavia.
But the government still expects some 85,000 asylum claims this year, making the Alpine country of 8.5 million people one of the highest recipients in Europe on a per-capita basis.
This has boosted support for the populist Freedom Party (FPÖ) which wants to build fences along Austria's borders and which is leading in opinion polls with over 30 percent of voter intentions.
Germany's interior minister last week also sought to stem the inflow from Afghanistan -- currently the number two country of origin -- saying that they "cannot all expect to stay in Germany."