All the way back in the past there were obligatory taxes in a country that every citizen had to pay. Taxes represents all of public giving to a state, respectively public revenue that covers all the public expenditure. Usually taxes are divided into direct and indirect taxes. While direct taxes represent the income and profit tax, indirect taxes are value added taxes and excise duties. All the different tax forms of a state make up the tax system. Tax systems vary from state to state, but certain types of taxes are neutral. For example, those are: income tax, profit tax, sales tax and excise duties. Tax system discussed in this thesis is the tax system of Bosnia and Herzegovina. The state structure of Bosnia and Herzegovina is separated into three levels, and those are the middle state, entity level and local level. Bosnia and Herzegovina does not have a unified tax system on its territory, instead of that each entity and district has its own tax system. Entities are the Republic of Serbia and Federation of Bosnia and Herzegovina, while Brčko is a district. The tax system of Bosnia and Herzegovina was regulated by the 1995. Dayton Agreement. The Dayton Agreement represents the signing of a peace agreement on the territory of Bosnia and Herzegovina that was signed on November 20., 1995. in the United States, or precisely in a place next to Daytona. Collected tax revenues represent significant revenues in the budgets of Republika Srpska, the federation of Bosnia and Herzegovina and Brčko District.