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By Lindsey D. Cameron, Julia Ticona, and Hannah Wohl
University of Pennsylvania’s Wharton School; University of Pennsylvania's Annenberg School for Communication; University of California, Santa Barbara
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Earlier this month, President Donald Trump signed the Big Beautiful Bill into law. One of its provisions that made a bipartisan splash on the campaign trail was the elimination of taxes on tips for service-workers like restaurant servers and bartenders, among many others. The proposal garnered bipartisan support among politicians and has broad support among the public. But Americans misunderstand this key item. While the bill eliminates taxes on tips, it also involves increased governmental tracking that will put these same workers under greater scrutiny.
Last year, the IRS began requiring platforms like Venmo, eBay, and Etsy to send tax forms to users earning money for goods, services, or tips through their platforms. While taxpayers have always been required to pay taxes on this money, many don't or aren't required to. A third of tipped workers don't even earn enough to file taxes. The IRS change lowered the threshold for the amount of money exchanged through these platforms that triggers the forms (for the 2024 tax season, the amount was lowered from $20,000 to $5,000, with plans to step down to $600 next year). As a result, platform companies estimated that they sent over 150 percent more tax forms out to their users. The promise of eliminating taxes on tips and the IRS rule change for platforms mean that many more small businesses, tipped workers, and occasional workers have been and will be cast into the spotlight of the IRS.
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This may not seem problematic on its own. After all, shouldn't businesses and workers pay taxes? But the danger is in how personal data on one platform can be linked to other data for different purposes. A few months ago, in a move so controversial that it prompted the resignation of the acting IRS director, a memorandum of understanding between the Department of Homeland Security (DHS) and the IRS allowed Immigration and Customs Enforcement (ICE) to request tax information in order to identify and potentially deport people in the U.S. facing final removal orders. Linking tips made through private payment platforms like Venmo to public systems like the IRS would further imperil already vulnerable and precarious workers.
As part of a group of leading social scientists studying platforms at the Institute for Advanced Study in Princeton, we have been investigating the promises and perils of platforms for workers, from Uber drivers to nannies. Platforms have extended their reach to every aspect of our lives. They are used to hire, fire, and manage us at work, counsel us when we are sick or lonely, and advise us on the best places to get a haircut, have dinner, and find a life partner. We may not have a problem with any one company knowing an individual piece of this picture, but the risks can be compounded if the data is strung together.
Americans have not fully grasped these potential consequences. Across the political spectrum, Americans report concern about how platform companies and the government may use their personal data, but say that they do not understand and feel powerless over how their data may be shared. This is a feature of how Americans interface with platforms. As consumers, Americans generally interact with platforms as individual apps on their devices that require them to click through terms and conditions—often packaged as lengthy legalese in small print—in order to send money to a friend, apply for a student loan, or simply share their pet photos. Once they sign away their data, future data sharing practices are opaque to them and the relationships between platforms are unclear. Americans are missing the forest for the trees, but it is only because they are not afforded a bird's eye view.
To be sure, data sharing across platforms is not inherently destructive. Shared data enables remarkable access to life-saving (and just plain helpful) resources. For example, epidemiologists have improved forecasting of COVID-19 and other infectious diseases by relying on a host of valuable datasets, including Google searches for symptoms. However, there are grave dangers of sharing such data without a careful consideration of how this merged data could later be linked to other pieces of information for less noble ends.
Concerns over the aggregation and selling of platform data aren't new, but they have become more urgent. In the past couple months, the Trump administration has steamrolled legal safeguards designed to protect our data using various measures—from the no taxes on tips item to the executive order to eliminate "information silos" among state agencies and between state agencies and third-party platforms. The government does not have an inalienable right to this kind of personal data.
Privacy is a bipartisan issue. Instead of holding consumers accountable for sharing their data responsibly as privacy laws currently do, we must hold platform companies and our government accountable for the responsible stewardship of users' personal data. As in the EU's General Data Protection Regulation, the U.S. should legally prohibit the secondary use of personal data—especially for immigration or criminal enforcement—unless the user gives informed, explicit consent. This would shift the burden of privacy protection away from individuals, who are often operating without meaningful choice, and place it on institutions with power.
Lindsey D. Cameron is an assistant professor of management at the University of Pennsylvania's Wharton School and a faculty associate at Harvard University's Berkman Klein Center for Internet and Society. She studies algorithmic management, the gig economy, digital platforms, and labor issues and is currently working on a book on the gig economy.
Julia Ticona is an assistant professor at the University of Pennsylvania's Annenberg School for Communication and in Sociology. She is the author of Left to Our Own Devices: Coping with Insecure Work in a Digital Age*, and her work has appeared in* The New York Times*,* The Nation*, and* Wired*.*
Hannah Wohl is an associate professor of sociology at the University of California, Santa Barbara, and a Public Voices Fellow of the OpEd Project. She is the author of Bound by Creativity: How Contemporary Art is Created and Judged and is currently writing a book on the production of pornography across digital platforms.
The views expressed in this article are the writers' own.
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