The topic of this final thesis is the taxation of wages through income tax. In today's modern times, taxes are one of the most important instruments for revenue collection; by collecting such types of funds (taxes), the state achieves the largest amount for its coffers. Countries generally differ in their characteristics, so their tax systems also differ. Items that affect the taxation system are the following: number of inhabitants, unemployment, size of the country, geopolitical position, membership of certain economic organizations, etc. According to the categorization of taxes, we classify income tax in the group of direct taxes, that is, as a tax that is imposed directly on a person's income. In the Republic of Croatia, this type of tax was first introduced in 1994, and was later changed through the Act itself, which was specially designed for this type of tax. The final paper gradually deals with the topics of taxes, income tax in general, but also with a special reference to this type of tax form in Croatia, explaining important tax concepts, through examples of different tax incomes. A special review is also given to the impact of this tax form in certain OECD members. The final part introduces the tax reform in 2023, which should enter into force at the beginning of the next year, January 1, 2024, where it is shown what changes await taxpayers, but also other stakeholders who participate in taxation with this tax form.