By contrast, the rich derive by far the largest part of their incomes from the return on physical and financial assets, which often go unreported. They often also have the power and ability to avoid paying taxes without fear of government reprisal.
Policies to enforce progressive rates of direct taxation on income and wealth, especially at the highest levels, are what are most needed in this area of redistribution activity. (See Chapter 15 for a further discussion of taxation for development.)