Income tax is a levy that governments charge on the money individuals and, in some systems, unincorporated businesses earn during a tax year. It is usually the single largest tax most working people pay, and it typically applies to wages, self-employment profits, rental income, interest and other earnings after allowable deductions.
Most countries use progressive brackets, meaning the rate climbs as income rises. In the United States federal rates run from 10% to 37%, with states often adding their own charge. The United Kingdom applies 20%, 40% and 45% bands above a tax-free personal allowance. Italy uses IRPEF rates from 23% up to 43%, France operates five bands topping out at 45%, and Germany blends a rising formula that peaks at 45% plus a solidarity surcharge.
Consider a UK worker earning 50,000 pounds. Roughly the first 12,570 is tax-free, the next slice is taxed at 20% and the remainder at 40%, producing a bill far below a flat 40% of the whole. This gap between the top band you touch and your average burden is why the marginal tax rate differs from the effective tax rate. Income tax is charged only on your taxable income, not gross pay. Use the compare taxes by country tool to see how the burden shifts across borders.