Taxes are necessary to support the public system of any country, and they are defined as payments to the state regulated by the law, for which the state does not provide any immediate service in turn. Paying the taxes is a burden to the taxpayer, in the sense that it decreases the amount of money available to him or her. Different countries have different types of taxes, with varied tax rates, subject to the decisions of the competent ministries and the government. The fact that taxes are frequently regarded by tax payers as too high, leads to various forms of tax evasion. Tax evasion may encompass legal or illegal actions aimed at avoiding paying the taxes, wherein the tax evader increases the amount of money available to him or her. The Republic of Croatia, just like any other country in the world, has its own tax system, which according to realistic criteria imposes a comparatively high tax burden on the taxpayer, when contrasted to numerous other tax systems. Consequently, tax evasion is very common in Croatia, making it important to understand its forms and causes, so as to be able to prevent it.