An income tax is a tax paid to the government on income generated in whatever manner by an individual or an enterprise. The basis of the income - the capital - may be taxed separately, as in property or real estate tax. A reduction in income tax is granted by the state or federal government either by actually reducing the amount of the tax payable, or amending the tax percentage, which also lowers the resultant tax. This falls under categories for employees, self-employed individuals, contributions to charities, tax on property, medical and insurance premiums, and training and educational institutions.
