When it comes to paying income taxes, eBay's legions of small-time entrepreneurs are on an honor system in which they are supposed to declare their profits to the Internal Revenue Service. Many users, however, ignore the law or are unaware of their obligation.
The Chronicle could have run this story with many different parties as the subject, but just chose eBay because it would catch reader attention. The Chronicle could have used the sentence template below, and used one or more of the groups in parentheses to catch the attention of various target markets.
When it comes to paying income taxes, (big-time drug dealers) (small-time flea market vendors) (real estate agents) (entertainers) (prostitutes) (white-collar criminals) (blue-collar criminals) (collarless criminals) (illegal immigrants) (contractors) (house cleaners) (exotic dancers, waitpersons, anyone paid tips) (just about anyone not stuck with a W-2, 1099, bank or broker statement) are on an honor system in which they are supposed to declare their profits to the Internal Revenue Service. Many users, however, ignore the law or are unaware of their obligation.
Where are the civil libertarians demanding equal protection and treatment under the law when it comes to paying and not paying taxes? If your taxes are withheld, your chances of paying your taxes are very high. If not withheld, you're more likely to pay from 0% to 50% of your income taxes.
Of all the organizations the IRS could publicize for nonpayment of income taxes, eBay gave the IRS a chance to put their weakest foot forward. eBay does not fit any legal definition of an organization required to report to the IRS. eBay is not a party to the transaction, and does not in fact know if a sale occurred, let alone at what price. Our local farmers market on the vacant lot by the Gualala Community Center performs the same function.
So do the huge flea markets my late first wife’s family couldn’t pass up: in northern California at San Jose, Vallejo, Sebastopol, among many; the parking lot of Aloha stadium, Oahu; the fair grounds in Belleville, Illinois, where my first father-in-law filled his pickup with work horse paraphernalia – “These people don’t know what this stuff is worth,” he whispered, as he cleaned out their inventory. “Another Californian,” they probably whispered amongst themselves as they rushed to restock.
For as long as the government’s primary source of revenue is income taxes, we will be continually regaled with tales of tax avoidance, and attempts to stop it. Instead of outrage at the tax cheaters, there is a perverse quirk in human nature that makes law-abiding tax payers (those of us who have to be because of withholding) side with the cheaters, even though the government wants to raise our taxes more to make up for the revenue lost through cheating.
Unlike the government, when I recognize a problem, I also recognize the need for a solution that will work. In the case of rampant income tax evasion, the solution is marvelously simple: abolish the IRS, and replace it with a national sales tax. With the flick of a pen, our incredibly expensive and ineffective taxation system would be replaced by a fair and inexpensive one.
To find out why it would work, please go to Keep it Simple, Simplifiers.
When you finish reading KISS, you'll whack your head with your hand and exclaim, "Of course, it all makes sense, and is so simple, why hasn't the government already done it."
Then you'll whack your head agian and say, "Of course, it all makes sense, and is so simple, no wonder the government hasn't already done it."
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