A government imposed tax, the income tax is a source of funds for the government to use to provide services for the general public, as well as fund the government itself. Generally, individuals and businesses must file an annual tax return with the government (or its appointed agency) to determine if the appropriate level of tax was paid during the year. The resulting amount will indicate if the filer will be due a refund (in the case of overpayment) or will need to make an additional payment (in the case of underpayment). Tax levels and rates vary with the government and are dependent on the laws and regulations of a particular country.
Not to be confused with state taxes, the income tax is generally levied on a national level. There may be a state income tax as well, but often the state tax is based on qualifications other than income tax. As the primary means of revenue for the United States government, it is a hotly debated issue that has advocates and detractors on both sides of the fence. The idea of income tax can be traced back as far as the Roman Empire, when taxes were levied against homes, slaves, animals and other property. This form of revenue is widely used in government today. Interestingly, there are some key elements in most tax systems. Primarily, taxes are expected of the residents of the country. Non-residents may have to pay taxes as well, but it is typically at a lower rate than that of the residents of the nation. Nearly every government allows for deductions of tax based on specific criteria. Taxes may be imposed through wages where the tax is withheld automatically, or through a PAYE (pay as you earn) system where the individual is responsible to pay the taxes regularly.