Theoretical issues of the effective organization of income tax in the Republic of Azerbaijan are considered in the article. The effective organization of the income tax system is very important for the economic development of society. In particular, the income tax of individuals is a burden for state taxpayers. It is from this point of view that it is necessary to regularly monitor the innovative development of the income tax system. In this direction, the article deals with such economic issues as conducting tax audits by means of electronic calculations of the taxpayer, financial (accounting) data and special software, as well as theoretical issues of the effective organization of income tax in the country. At the same time, such economic issues as the state’s importance in the formation of the tax system in our country were analyzed. In modern economic conditions, the necessity of creating an effective system of tax collection during the implementation of market reforms is noted. Purpose – Engaged in entrepreneurial activity in Azerbaijan from studying the modern state of the income tax system in enterprises and studying ways to improve it consists of. Methodology – economic, statistical and comparative analysis methods were used in the research work. The results of the study – with the activity of the entrepreneur in the country. Busy which is income tax system in enterprises on improvement and efficiency improvement suggestions have been made. Keywords: income tax, tax system, theoretical foundations, economic development, entrepreneurial activity, enterprises, reforms