It all started when financial institution ABSA started a poll on Twitter asking what black tax meant to people.

See the post below: 

It was no surprise that the masses were offended by the bank’s tweet because this is a rather sensitive issue in the black community.

The bank then later apologised for their tweet. See the post below:

In our April issue we unpacked the black tax topic.

What is black tax?

According to new discoverybs black tax is defined as the responsibility employed blacks have towards helping their families especially parents and extended family members.

How it affects young professionals 

Lerato 38, is an engineer and remembers her parents supporting members of their extended family. “When I was growing up, my parents were supporting two nieces in addition to my two brothers and myself. My parents paid for their education from high school through to university. My mother is the eldest, and she and her younger sister were the first to go to varsity, so it was expected that they’d support their three other siblings once they found work. “My father is from a family of five and he’s the only one who went to university, so he was supporting, and is still supporting, the children of his siblings in some way, even though he is a pensioner.” 

Lerato is currently single and says, as the eldest child, she has taken on the role of ragadi (aunt) in the family as her brothers have not lived up to the role that traditionally should have been fulfilled by men. She and her mother are currently raising her brother’s daughter, Unathi, 11. “My brother doesn’t have a stable job and Unathi’s mother was carrying the responsibility of raising her –paying day to day expenses and school fees by herself. We stepped in because we wanted to give her some time to get herself out of debt, so we agreed that for 12 months we’d take care of Unathi. She would live at home with us and we’d help pay school fees and her day-to-day expenses.”Three years later, the situation has not changed. Instead, Lerato says, she’ll have to step  in as Unathi’s main benefactor. “My mother and Unathi’s mother share the school fees, which amount to R75 000 a year. We all contribute to her clothing. But I pay about R15 000 towards her extra-mural activities and for extras like trips to the movies, her hair and other treats. So in a year, it can add up to another R15 000 and that excludes groceries for the household. My mother is a pensioner, she earns some money from sitting on a few boards but from next year I’ll have pay the school fees as her income is shrinking.”

While Lerato has no resentment towards her niece, who she adores and sees as her own child, the situation has taken an emotional toll on her. “I don’t mind the money. What hurts me the most is that my own brother has never said, ‘Thank you.” 

Last year, Old Mutual released its Key Savings and Investment Trends Report 2017, which showed that 36% of black respondents were supporting extended family with their income. Of those, 26% are supporting a parent or two, while 11% support a sibling.  

Recruitment consulant Sizakele, 29 says “I graduated when I was 21 years old, and I knew that I had to help my family by sending money every month. When she moved in with her boyfriend Sbo she was frank with him about her financial situation.” Sizakele says she explained that because of money obligations – which she actually doesn’t mind doing – she couldn’t contribute to their household expenses as much. “Fortunately, Sbo understood because he also sends some money home too. It actually made our bond stronger because we both appreciate how privileged we are, and that we’re able to help our families live a better life kindness exploited. “Compromising yourself would be giving and giving, yet ending up in a worse place.”

Sales manager Mandisa, 35, has a different story. Unlike Sizakele,  she’s resentful of her black tax obligations but is torn between loyalty towards her family and her own financial obligations. “I only have a bond as debt so I made the conscious decision to help my family where ever I can. It started with small things like groceries here and there for my parents, or treats like dinners when we’re on holiday as a family. Then, over time, it became an expectation and it grew from treats to me helping my sister pay my nieces’ tuition or my younger sister living rent-free with me for 18 months until I kicked her out because I had enough. I fork out between R5 000 and R10 000 a month on their extra requests.” 

Mandisa says she has made the conscious decision not to let her status as the ‘family ATM’ affect family relations. She’s aware that, with the disposable income she dishes out, she could put more towards her bond or even a savings plan.

“I’ve thought about saying no, but I know I’d feel guilty because I’m single and don’t have debt, so I can always make a plan. But when I get married or get in a serious relationship, this will all change. They know this because, as an African woman, my responsibilities will be towards my household with my husband, not to them”.