A Multilevel shunt active filter is proposed to reduce the harmonic contents in source currents of a harmonic polluted three phase system supplying a non-linear load. The shunt active filter is designed with a seven level cascaded H-bridge inverter. To generate the required compensation currents Multicarrier PWM Current control method is used. The reference compensating currents are extracted from the system using two distinct sinusoidal subtraction methods. The effect of these methods on a system supplying balanced and unbalanced nonlinear loads is analyzed and presented. Simulation of the active filter with proposed current control and dc bus control is presented. Multilevel shunt active filter does not require an interfacing transformer to connect it with the high power system. It reduces the filter current ripples and improve source power factor.