The concept of taxes as historical categories is conditioned by economic, political, social and other numerous circumstances. Tax is a form of forced giving imposed by the state, it is not targeted and has no direct counteraction. In short, the place and role of taxes have not always been the same everywhere, they have adapted to the development of the country and the functions the tax had taken over. Income is the total amount of funds, in monetary and non-monetary form, which is available to an economic unit for consumption and savings. Income tax appeared at a time of growing industrialization, when more and more people were earning an income, which opened the possibility of introducing income as a new subject of taxation. Given its stratification and collection technique, it is a tax form that enters the circle of the most complex tax forms. An important precondition for its successful collection is a developed economy with high employment, well-organized accounting and tax services and a strong willingness of taxpayers to cooperate with the tax authorities. Income is the difference between receipts received in a tax period and expenditures incurred in the same tax period. In Croatia, six sources of income are taxed. They are employment, self-employment, property and property rights, capital, insurance and other income. Income tax systems are constantly being exposed to certain reforms and it is precisely these constant changes that are their most significant feature. The distribution of income tax is regulated by the Law on Financing of Local and Regional Self-Government Units. Income tax is shared between the state, municipality, city and county. A taxpayer is a natural person who earns income. The tax rate is determined as a percentage of the tax base.