By analyzing the principles, the question of the tax system in our country arises. By collecting taxes, the state generates the necessary revenues that help it cover its expenses. We all have to pay a part of the income to the state so that in return it provides us with education, health care... If the state does not collect the income, it cannot progress. The Croatian tax system consists of direct and indirect taxes. Direct taxes are: profit tax, income tax and surtax on income tax, and indirect taxes are: value added tax, excise duties, real estate transfer tax. Taxes are the most important source of government revenue. The tax system varies from state to state, and no two tax systems exist. The tax system of the Republic of Croatia is harmonized with the guidelines of the European Union. It is based on the Constitution of the Republic of Croatia, the General Tax Law and other acts that regulate the tax system. The tax system affects employment, improvement of economic activities, investments, etc. Observing all this, I come to the conclusion that Croatia should try to improve the tax system, because it would attract domestic and foreign investors, and it would contribute to the development of the economy.