Tyrannical governments want to tax anything and everything that moves. No money is permitted to change hands without the government taking a cut. Like in the movie “The Godfather Part II,” the big guy just wants to wet his beak.
For a society that rests on a thriving small-business culture of commerce, such would be a disaster. Especially in these hard economic times, being able to sell and buy online or in person without intervention from government tax collectors is essential.
The previous administration tried to change that. Under the old rule, people who sold anything to anyone did not face any kind of tax consequences provided it was not a main business but only a side business. Under the pre-2021 rule, you had to sell more than $20,000 in goods and conduct more than 200 transactions in order to trigger the requirement to file a 1099-K return and thus pay income tax.
Under the changes that were implemented four years ago, the threshold was lowered and lowered, with the goal of reaching a mere $600 next year. This would have been a paperwork and tax disaster for many people who rely on eBay and Facebook Marketplace revenue, as well as those who hold yard sales and people with booths in antique malls. Any kind of consignment shop would have been hit.
Fortunately, as part of the One Big Beautiful Bill Act that has been passed by Congress and signed by Trump, this taxation scheme has been reversed. The new law reverts the standard back to what it was in 2021. So at least we’ve been spared one revenue scheme for now.
Still, that it was tried shows precisely what some people want to do. They cannot stand the idea that any commerce would be taking place at all without government oversight and revenue collection. Such a technical change would expose millions to unprecedented tax liabilities and enforcement actions that are wholly unjustified.
One of the greatest achievements of the digital age has been the unleashing of commerce among regular folks. It’s been so wonderful that the present generation cannot even imagine what the past was like. There was no eBay. There was no Etsy. There was no Bonanza or Depop. Whatever clothing you possessed, you mostly had to buy retail or have it gifted or made by a family member.
When I was very young, my grandmother on my mother’s side made me four shirts for the year from cloth and patterns she found at the fabric store. I didn’t think anything of it. Anything else required going to a retail store in town since there was no chance to order anything, new or used, that was out of town. Yes, there were the gigantic catalogs but those required stamps and checks and delivery times of six to eight weeks.
It was certainly a different world.
Now you can buy anything from anywhere, new or used, from countless shops. Everyone is involved. The other day, I decided I needed a new winter tweed sportscoat. Ebay alone offered many thousands of options. I finally got tired of shopping and just bought something. It was a jacket that would have run $600 in a retail shop, and I snagged it for $45. It was delivered in two days.
This is the world in which we live. I write so often about the downside of the digital world, but we should equally admit its upside. No question, its best feature is the emancipation of merchants—even more, it has created merchants out of anyone. Any houseful of junk can be turned into thousands of dollars of spending money with the posting of a few photos online. That’s a glorious thing.
Any government that should seek to throttle such activity is not your friend. It is a government determined to extract revenue from any source, even poor people who have figured out a way to make a buck or a few by offering inexpensive goods and services to people using existing technology. That government deserves to be voted out of office forthwith.
Last year alone, eBay sold $74.7 billion worth of goods with more than 2 billion product listings. This is nearly all waste that is forgone because of technology alone. These are mostly goods that are already used that have been reused, which is something that the left has been urging for many generations: Stop buying new so long as the old is still useful.
In other words, this should not be a partisan issue. In fact, the threshold of income should be closer to or beyond six figures. There is absolutely no justification in theory for why this sort of sale should be taxed at all.
Again, this is not about the rich. The rich buy new, and they buy retail. It’s regular people who have been saved by these marketplaces. For my own part, I have zero hesitation in buying clothing that is technically labeled as used provided that it is in good condition.
I have to laugh at people who balk at this. Coming from the clothing business, I can promise you that a suit or jacket on the rack at the store has been tried on a dozen times before it is ever purchased. Somehow this is never disparaged as used. I don’t get it. If the goal is clean, it is possible to clean used clothing!
Another wonderful feature of eBay is how it reveals the true market value of products. I held onto a toaster from my grandmother on my father’s side for many years because I thought it was a priceless antique. It turns out you can buy one on eBay for $10. Who knew? I realized that the value I placed in the item is entirely sentimental, and there is nothing wrong with this.
For all the loathing and denunciation of large online sellers such as Amazon, there are millions of small sellers too that otherwise would have no way to reach buyers. This is the main or even the only value of Facebook today: Its marketplace connects you with sellers all around you who have value to give in exchange for money or sometimes even the willingness to pick the thing up.
The war on small sellers that began in the previous administration was a travesty and should never be allowed to come back again. Surely, in this country that calls itself free, you should be able to earn $20,000 without reporting it to the tax man and letting him wet his beak in the money you earn through your own efforts.
Small sellers should feel gratitude to the party in power and all who lobbied to make this change. At last, we are free again to buy and sell without having government take a cut.
