No, you are not taxed on the entire amount. You subtract the required expense on your Schedule C when you file your income tax. What you stated is a common misconception which has been dealt with many times on this forum. It doesn't matter if it is a flat fee with required purchases, or a fee with reimbursement. The tax consequences are exactly the same. And it doesn't matter if you make less than $600 from an MSC, you still have to report the amount you receive as income. Then you report expenses, including required expenses, mileage, paper, staples, ink, etc. You pay tax on the net profit.
Goodwin rarely pays anything other than a flat fee. Figure out the cost of the required purchase and subtract from the flat fee. If it makes sense for you to do it, then you do it. If not, pass.
Shopping Southeast Pennsylvania, Delaware above the canal, and South Jersey since 2008