Well, I can see I am in the minority here, but here is my opinion on this issue.

Millions have been made by people figuring out ways around taxes and fees. Let's face it, the billions of tax loopholes are there because someone found a way around a fee. The same thing happened on Ebay with the shipping costs until Ebay decided they were going to close that hole. Those people charging $25 for shipping or $199 in shipping for a $1 item were businesses that found a loophole and used it.

The paypal gift is the same thing. It is a loophole that paypal knows is being used this way. They can't be stupid enough to think that it isn't being used that way. What they count on is that once you have a paypal account and are using it, you will be buying things from online stores and ebay where they get the fees. The Personal Gift is a way to get you used to using Paypal and feeling safe with it. If it weren't, they would have put a fee on it years ago. How many people would really use it as a way to send mone to others? It takes 4-5 days to withdraw the money. In most cases you could send a check in the mail quicker. At some point, paypal will decide that they want to take fees from those $10 and $20 transactions and will put fees on personal gifts. Until that happens, it is smart business practice to avoid as many fees as you can and earn as much profit as you can.