The concept of 'black tax' in Eswatini refers to the informal financial support provided by working individuals to their families, often without a formal agreement or end date. This support can include paying school fees, medical bills, and other household expenses. According to a 2023 labour survey, nearly 200 000 people aged 15 to 35 in Eswatini are neither working nor studying, placing a significant burden on those who are employed. The 'black tax' is rooted in Ubuntu, the belief that one's wellbeing is bound to that of others.
A recent example illustrates the weight of this burden. A 30-year-old man earning E4 000 per month allocates E400 to his mother's household, E200 for his three grandchildren's school costs, and E100 for other expenses, totaling E700 or more than a sixth of his income. This leaves him with limited financial security for his own needs, such as rent, food, and transport. His mother, who relies on his support, spent her working years without a pension and now carries the household alone.
The pressure to provide financial support can come from both sides, with elderly parents expected to care for their grandchildren and working individuals becoming the family's safety net. In some cases, children head their own households and survive on the kindness of neighbors. The 'black tax' can also lead to a situation where one salary supports two households, as seen in the example of the 30-year-old man.
The consequences of carrying this burden can be severe. If the 30-year-old man continues to pay E700 per month from age 30 to 45, he would have paid E126 000 by age 60. Had he saved this amount instead, it would be worth approximately E632 000. His provident fund, untouched from 30 to 60, would hold around E488 000. The trade-off between supporting family and securing one's own financial future is a delicate one.
To mitigate the risks associated with the 'black tax', it is essential to create a budget that prioritizes one's own financial security. This involves allocating funds for housing, transport, food, debt repayments, insurance, emergency savings, and retirement. Only then can an individual decide how much they can afford to send to their family each month. A steady, affordable amount beats a promise that may require borrowing to keep.
Families can also work together to share the burden of financial support. In cases where multiple siblings are working, a shared plan can be fairer than leaving it all to one child. Contributions need not be equal, but rather proportional to each sibling's income. A stokvel, a type of savings club, already demonstrates how to share financial responsibilities.
To manage the 'black tax' effectively, it is crucial to differentiate between one-off needs and ongoing support. Borrowing to give can turn one obligation into two: the family expense and the loan repayment. By prioritizing financial security and working together, families in Eswatini can balance their support for one another with their own financial wellbeing.
Key points
- A budget prioritizing one's own financial security can help mitigate the risks associated with the 'black tax'.
- Families can work together to share the burden of financial support, making it fairer and more manageable.
- Distinguishing between one-off needs and ongoing support can help individuals and families make informed decisions about their financial commitments.
Reporting sources
- To whom much is given · Swazi Observer
