‘Thrift Hunters’ Star to Speak to Congress about Internet Sales Tax Issues
“Thrift Hunters” co-star and Thrifting with the Boys founder Jason T. Smith (left) with U.S. Sen. Dean Heller (R-Nev.) during the Small Business Fly-in/Advocacy Day of the U.S. of eBay held in 2012. Smith will be talking with senators and U.S. representatives on April 30, 2014, about the issue of Internet sales tax as it applies to small-volume e-Bay sellers.
Jason T. Smith began his little store on eBay with hopes that he could eventually earn enough money selling things he found at thrift shops to take his wife out to dinners and cover his expenses. Now, Smith—one-half of the Thrifting with the Boys duo and co-star, with Bryan Goodman, of Spike TV’s hit “Thrift Hunters”—has built his thirfting business into a six-figure operation.
The TWTB Facebook pages have some 10,000 followers and Smith says that he and Goodman are often stopped on the street by viewers of their show, telling them how they have become inspired to try their hand at selling on eBay. Not too bad for a guy who just wanted to scour the local Goodwill shop in hopes of finding a really cool Hawaiian shirt.
Because of his success, Smith will be making a trip to Washington, D.C., on April 30 as part of the Small Business Fly-in/Advocacy Day of the U.S. of eBay, where he will be talking to senators and congressmen about the issue of Internet sales tax.
There are about as many different types of sellers on eBay as there are items to buy and sell (well, not really, but there are a lot). And the issue of taxes is a big one.
“If you have a nexus (a residence or a brick-and-mortar warehouse) in a state with a sales tax, you have to charge for that tax when you sell to someone in that state,” Smith said. “I live in Nevada. When I sell to someone in Nevada, I have to charge that tax. Now, big billion-dollar businesses, like Amazon and Wal-Mart, they have stores or warehouse (nexuses) all over the country, so they have to charge that tax more often. Because of that, the big guys believe us little guys are getting an unfair advantage.”
Smith says that if the regulations are changed, and mom and pop eBay stores are forced to charge sale tax to everyone, the logistics would be costly, and may even end up putting many of these small eBay sellers out of business.
Mr. (Jason T.) Smith goes to Washington. In this case, Capitol Hill, where he will be making the case that small-volume eBay sellers should be exempt from an expanded Internet sales tax.
As an example, Smith says he showed his parents, who are in their 70s, how to establish an eBay store of their own to supplement their retirement and Social Security. “They go out and thrift every day, dad takes the picture and mom does the listings,” said Smith. “Then they travel for a week or two with the money they earned and then they are back at work, thrifting some more.”
Smith says that he hears similar stories when he meets fellow eBay sellers on the street.
“I heard this heartbreaking story at an eBay on Location event in Phoenix. A woman came up and hugged me and started crying. She said she was able to take what she learned from us about thrifting and was able to sell enough stuff and made enough money to keep family off of food stamps. She’s not a business. She’s subsistence selling.”
There is a computer program, Smith says, that compiles the state, country and regional sales taxes for any given location—some 9,200 different taxing jurisdictions—but he says that the program costs $5,000, plus the cost of annual updates. “If you are a mom and pop doing $25,000 in sales on line, you’re not going to pay $5,000 for the program. It’s not worth it,” he said.
As part of eBay’s Small Business Fly-in/Advocacy Day, Smith will be paired with another eBay seller from another state, and they will walk the halls of Capitol Hill, meeting with senators and representatives from their respective states, lobbying on behalf of the small sellers. Two years ago, Smith was part of the same delegation, meeting with Sen. Dean Heller (R-Nev.) and Rep. Joe Heck (R-New.), as well as members lawmakers from Utah.
Smith said the eBay delegation received a mixed reaction from the senators and congressmen he met on this same mission two years ago.
“Some of the senators’ wives have shopped on eBay, and Joe Heck was wearing a watch he bought on eBay, so they had that kind of connection with us. Others simply weren’t that interested in talking to us, telling us they would not change their minds.”
But Smith was able to make an impression on Sen. Heller about the issue, explaining how it could hurt hatchling small businesses. He said he was able to change his senator’s mind on the issue.
“I have no problem paying taxes,” said Smith. “I pay the taxes on what I buy, somebody paid the taxes when they bought the items originally, and this puts money back into the economy and helps these non-profits shops, such as Goodwill and the Salvation Army. I’m really a legit business, but my mom and dad aren’t. That woman from Phoenix, she isn’t.”
Smith says that if mom and pop eBay selling operations are forced to behave like a business, they may just fold up, which will put a lot of people on shaky financial ground.
Smith says that he believes that eventually, there will be some kind of program put in place where businesses like his, which generate a large income, will have to begin charging sales taxes across the board, but he hopes that he can convince lawmakers to safeguard the smaller eBay sellers.
“Let’s set up some limits so we can protect the little guy,” Smith said. “They’re going to have to give us a threshold that establishes what a ‘small business’ is. The Small Business Administration has one idea, other government agencies have others. They have to decide on what that designation will be. Will it be total sales? Will it be the number of employees? I don’t know yet. But I’m willing to play ball. I hope I build an empire where I have to pay a ton of taxes, I’d love that.”
Gregory Watkins is the executive editor of WorthPoint. You can e-mail him at email@example.com
WorthPoint—Discover Your Hidden Wealth