Black Tax: Understanding the financial transfers of the emerging black middle class

ABSTRACT

This study examines the ways in which the emerging black middle class make financial transfers to their direct and indirect families. The colloquial term in South Africa for this phenomenon is Black Tax. This study specifically focuses on understanding the lived experience of those making financial transfers. The methodology involved a questionnaire (n = 118) and six interviews. The main findings are that the transfers are substantive and most often spent on general expenditure and education. Transactions are to both urban and rural recipients and generally occur monthly. Those transferring money are dissatisfied with their own savings’ levels. The study demonstrates the applicability of the remittance script framework. Those transferring money blend script elements of obligation, repayment, help, blackmail, pooling and allowances. The study demonstrates the economic, social and personal significance of these transfers. It builds the foundation for further research on the social and economic aspects.

KEYWORDS:

• Black Tax
• South Africa
• middle class
• financial transfers

1. Introduction

This study examines the ways in which the emerging black middle class make financial contributions to their direct and indirect families in South Africa. The colloquial term for this phenomenon is Black Tax. Understanding how the emerging black class has experienced the democratic South Africa has potential implications for the country's socio-economic development. The study specifically focuses on understanding the lived experience of those making financial transfers. It builds the foundation for further research, specifically on the economic and social impacts.

The term Black Tax in the South African context is most often used differently to the way it is employed in the United States. In the United States, Black Tax is often understood as the additional burden placed on African Americans who need to work twice as a hard to prove their worth (Stevens, 2014). In South Africa, Black Tax is a term used in general conversation, in social media, in newspapers and in the online press (Planting, 2013; Ratlebjane, 2015; Chabalala, 2016; Nt’sekhe, 2017). The study demonstrates the economic, social and personal significance of these transfers. Ratlebjane (2015) describes Black Tax as the ‘extra money that black professionals are coughing up every month to support their extended families’. Refiloe Nt'sekhe in a weekly newspaper described her own experience,

The beginning of this year was especially challenging: I had to buy my sister comfortable shoes for nursing college, and school shoes for my three boys and my other two children. I felt like I had given birth to three children but adopted another three without evaluating whether I could actually afford six children. Nt’sekhe (2017)

It is often experienced as a pressure to care financially for people in a broad family or kin network, while at the same time trying to build sustainable wealth.

There is substantive research on financial transfers, remitting, kin networks and the black middle class; this study specifically focuses on the ways in which the emerging black middle class makes financial transfers to their family. The researchers locate the transactions and experiences within the context of the post-apartheid South African transition. This study represents an initial examination of the character of the phenomenon and outlines the terrain for further research.

The changes in South Africa have impacted nature of racial representation (Durrheim, 2005) and intergroup relations (Duckitt & Mphuthing, 1998; Finchilescu & Tredoux, 2010). In terms of lived experience, Soudien (2008) has looked at how university students experience their race on campus and how black students experience both the opportunity for confidence building and the challenges of navigating a historic ‘white’ campus. Black adolescents have been shown to navigate a changing developmental landscape with new pressures for higher levels of individualism (Stevens & Lockhat, 1997).

In the business and management literature, from a consumer behaviour perspective, younger people who are first-generation middle class have been shown to experience particular consumer pressures in their efforts to ‘catch up’ and ‘keep up’ (Chipp et al., 2011). In firms, managerial identities have been found to be in flux (Mayer & Louw, 2013), although race continues to have a strong influence on identity (Booysen, 2007).

There is limited research on the emerging middle class financial transfers, specifically in South Africa. There is post-graduate research (Magubane, 2017), and the issue is touched on in scholarship of recent student movements (Chikane, 2018). We posit that Black Tax is an affective term that is associated with shifting social identities (Booysen, 2007). The term ‘Tax’ denotes a negative pressure and expectation. The use of ‘Black’ suggests it is perceived as an experience related to being a Black South African. These financial transfers may decrease savings and investment on the part of those making the transfers. This may shape family dynamics in important ways. These transfers may also have broader economic consequences. They may hinder the growth and sustainability of the black middle class due to an impaired ability to save and invest (Planting, 2013). There is some evidence in South Africa (Di Falco & Bulte, 2011) and internationally for these potential impacts (Hall & Crowder, 2011; Shooshtari et al., 2014; Jakiela & Ozier, 2016). New migrants can become trapped in middle-income contexts (Rigg et al., 2014). A stagnating or declining black middle class potentially poses a risk to political stability. Alternatively financial transfers may have a politically stabilising influence by supporting the economic advancement of beneficiaries.

Different experiences of kin network expectations and financial transfer pressures across race and class could contribute to shaping racial identities in the workplace (Pettigrew et al., 2008) and lead to increasing the fault lines in the workplace. Fault lines and conflict can impact team and organisational performance (Meyer et al., 2014), especially in the shorter term (Mäs et al., 2013). Understanding emerging black middle class financial transfers might enable more insight and empathy on the part of companies and corporate leadership. Leadership can be understood as relational (Uhl-Bien, 2006) and empathy can create affiliation which can enable leader effectiveness (Choi, 2006).

In the early part of this paper, we use descriptive statistics to describe the phenomenon as experienced by the sample studied. Then we use the concept of remittance scripts (Carling, 2014) as a framework for describing its potential character. Although remitting is a specific form of inter-household financial transfer of money, the script concept is potentially useful for understanding the phenomenon.

Our starting question was: What are the main characteristics of Black Tax? In this initial exploration of this form of financial transfer we avoided inferring too much. We share descriptive statistics from a group self-identifying as impacted by the phenomenon. Our second question was: What are the specific experiences of Black Tax on the part of the person making financial transfers? The transactional experiences and the general perceptions are described using the concept of remittance scripts. We end the study with suggestions for further research.

2. Literature review

The financial support provided by the emerging black middle class in South Africa is not entirely unique. We briefly describe the broader literature on kin networks and inter-household transfers. We then make the case for the value of the remittance script concept as a language to explore the phenomenon of Black Tax.

There is limited research on the contemporary character of black middle class financial transfers (Magubane, 2017; Chikane, 2018). These transfers can be seen as embedded within kin networks in South Africa. Social and economic support in kin networks is well studied (Hofferth, 1984; Haxton & Harknett, 2009). Intra-family transfers of the type that the emerging black middle class is making are a global phenomenon (Gale & Scholz, 1994; Cox et al., 1998; Gibson, 2006). In addition, the experience of first-generation middle class adults, the so-called sandwich generation, has been described (Riley & Bowen, 2005).

The emerging black middle class often lives in suburbs or city neighbourhoods that their families were previously denied access to due to Apartheid. They travel back to the family homes in townships, small towns and rural villages on weekends or only during holidays. This implies a geographic separation from both direct and extended families, and this separation can often be a physically substantive one. Remittance theory is a line of study concerned with the financial transactions between senders and receivers, mostly after rural-urban or cross-border migration. While black middle class family relationships do not always come with associated geographic movement, often this is the case. In this context the concept of remittance, and especially the socially embedded nature of remittance scripts, is a potentially valuable vocabulary to examine Black Tax. The remittance script concept is introduced below as an ethnographic and socially embedded framework.

2.1. Remittance scholarship

Remittances across nations have been studied in substantive depth (Taylor, 1999; Azam & Gubert, 2006). Remitting is a global phenomenon (Arslan & Taylor, 2012; Makina, 2013). Remittances are often part of a family contractual arrangement that is motivated by the prospect of an improved financial and social position (Stark & Lucas, 1988). These contracts are generally implicit and embedded in social relationships.

The study of remittances has been approached from an economic and an ethnographic perspective. Most of the studies have been from the economic view. For example, studies have explored the impact of remittances on the receiving economy and on relative inequality (Stark et al., 1988; Barham & Boucher, 1998; Shen et al., 2010). Much of this line of inquiry has explored the potential positive impacts on receiving families (Rempel & Lobdell, 1978).

Substantive scholarship has also focused on the drivers and motivations for remitting through this broad economically oriented lens (Lucas & Stark, 1985; Meyer et al., 2012; Czaika & Spray, 2013). A different strand has looked at issues other than economic impacts. Recent scholarship has explored the links between remittances and social capital formation, finding mixed results (Fransen, 2015). Other recent work has explored the impact of foreign remittances on violence, finding a correlation (Hassan & Faria, 2015). Efforts have been made to understand the relationship between the remittance and governance. A strong causal relationship has been found between the remittance to GDP ratio and lower levels of control of corruption (Abdih et al., 2012). Remittances have a shadow side.

We connect this study to the ethnographic strand of research. Carling (2014) argues that there are dominant approaches within the economic perspective, but no similar dominant approach exists within the ethnographic tradition. In the ethnographic tradition, remittances become the bond that ties individuals together within their immediate and extended family. Remittances can be an expression of gratitude, a way to thank family, a way to show care and a way to uplift the family to a higher standard of living. They can also be a way of preserving or even enhancing hierarchical status in the family. This may be to ensure inclusion in inheritances or to boost one's ego and even preserve one's assets during travel or migration to urban areas.

2.2. Remittance scripts

Remittance scripts provide a comparative vocabulary that can be employed across time and geography (Carling, 2014). Scripts can be described as structures of shared expectations for specific types of situations. They have been used in other domains such as in the study of life-events (Berntsen & Rubin, 2004; Janssen & Rubin, 2011).

Carling (2014) builds on Page and Mercer’s (2012) conceptualisation of remitting less as a dyad, between sender and receiver, and more as a socially embedded and communal practice, rather than an individual choice. This can invite a shift in questioning from ‘why do migrants remit?’ to ‘what is the nature of the transaction?’ (Carling, 2014). He proposes that remittance scripts offer important insights ‘by attempting to capture the entire bundle of material, emotional, and relational dimensions’. The implication of this is that we can't understand remitting without understanding collective processes of socialisation. The sender and receiver can be understood as transactors in a collective social process (Åkesson, 2011). Money transfers can be understood as the most visible and quantifiable element in a multifaceted transaction. Scripts embody specific meanings. This analytical concept has been used in sociology, anthropology and psychology since the 1970s. While scripts specify roles and actions, they do not define behaviours and outcomes. It is therefore more accurate to say that senders and receivers act with scripts rather than follow a script. Individual choice is exercised as people choose how to conform to the script and innovate around it.

Twelve scripts (compensation, authorisation, repayment, pooling, gift, allowance, obligation and entitlement, sacrifice, blackmail, help, donation and investment) relating to remittances have been identified (Carling, 2014). These are summarised in Table 1 below. Scripts can be segmented. Some of the money will be used for one purpose and some money for another. They can also be layered and overlap in the same transaction.

Table 1. Remittance scripts based on Carling (2014).

Script	Description
Compensation	This refers to payments to a recipient for undertaking an important activity on behalf of the sender such as overseeing the construction of a house or caring for cattle
Repayment	This refers to the repayments of debt incurred in the movement that the migrant has undertaken. This could include the costs of moving or directly for the expenses incurred in education
Authorization	This refers to money transferred for specific expenses. The receiver will use it only for the activity specified at no benefit to themselves
Pooling	This refers to the shared way in which a family will combine resources to care for the family. For example a sender might contribute money to pay for an event but a the receiver may be putting in their labour or other resources.
Gift	This is an irregular non-obligation based financial transfer for example for a specific celebratory occasion
Allowance	This is a regular payment for a defined purpose such as the payment of school fees or transport
Obligation and entitlement	This is a transfer that is made because ‘it is a given’. This is often associated with social norms for example caring for parents. There is an implicit expectation on the part of the recipient.
Sacrifice	This is a script strongly associated with the difficulties encountered in the journey to another location. The sender is subordinate the receiver and placed their needs above their own
Blackmail	Backmail is a script associated with the fear of consequences should one not remit. This is often a social sanction for example where the recipient makes the sender feel guilty for not sending money
Help	Here recipients have worthy needs that the sender can alleviate through their generosity
Investment	In this script the money transferred is for specific assets that can earn an income. This could include the building of rooms to rent in ones place of origin
Donation	This is a charitable contribution that could be for a community or religious purpose

2.3. Transfers and remittances in South Africa

Black Tax is understood as a financial contribution linking the emerging black middle class in South Africa to their economically disadvantaged family. Black Tax in the South African context is used differently to the way it is employed in the United States. In the United States, Black Tax is often understood as the additional burden placed on African Americans who need to work twice as a hard to prove their worth (Stevens, 2014).

Within South Africa, local remittances have been well studied. These have often been in the context of rural to urban migration (Lu & Treiman, 2011). The history of remittances in South Africa is linked to mining, migrant labour, Colonialism and Apartheid (Wolpe, 1972). One of the policies of Apartheid was a rural homeland system in which Black South Africans were forced to live far from places of economic opportunity. Economic migrants moved into urban areas. From there, migrant labourers sent money to their families left in the rural homelands.

Following reforms in the 1980s, there was an opening up of the economy and more opportunities. This continued more rapidly after 1994. The black middle class was one of the main beneficiaries of post-apartheid economic policy (Lipton, 2014). Definitions and size estimates for the black middle class vary, but it is widely believed to now account for more than half of the middle class. But even as this socio-economic group grew, development in the areas in which many black people resided was limited. Income inequality continued. For example, in the first few years after political changes began, real 40% of the increase in real incomes went to the richest 10% of black African people (Seekings & Nattrass, 2002). Following these changes, the nature of family centred financial assistance has changed. A significant number of black South Africans still rely on financial assistance from those family members that have found new economic opportunity (Posel, 2004).

3. Research methodology

The research followed an inductive approach (Saunders & Lewis, 2012) conducted through the use of a questionnaire with quantitative and open-ended questions, combined with the deductive analysis of six semi-structured interviews. The data was gathered in the second half of 2016 and gathered concurrently. The combination of these data sources was intended to draw positively from respective methodological approaches to give an overall picture of the issues (Creswell, 2013).

3.1. Phase 1: questionnaire with quantitative and open-ended questions

Quantitative data was collected using a questionnaire. Careful consideration was taken into selecting specific questions, taking the existing literature into account. The questionnaire contained both open-ended and closed questions. A likert scale was used (with a five-position range from ‘strongly disagree’ to ‘strongly agree’) across a number of questions (Ornstein, 2013). The response rate for the closed and quantitative questions was high, while the response to the open-ended questions was lower.

Self-selection sampling, a non-probability sampling technique, was used. This is an important qualifier on the interpretation of the results. No statistical inference can be made to the broader group of emerging black middle class South Africans making financial contributions to their families. The findings apply to the sample only. That said, there are some potentially interesting findings that strongly motivate for wider studies. The questionnaire was emailed to a broad network of emerging middle class colleagues and friends within the peer network of one of the researchers. It was also posted on Twitter and Facebook, two social network sites. Non-probability samples do pose a risk of homogeneity, particularly self-selecting participants as they may resemble similar interests. When participants self-select, they generally have strong feelings about the subject, hence they take part in the survey of their own volition.

Twenty three questions were asked in the questionnaire. The first part of the questionnaire focused on demographics; the second part on the experience of making financial transfers. Even though the questionnaire was complete with anonymity, asking questions around financial information is sensitive. For this reason, the sensitive questions around income, savings and remitting amounts were framed so that respondents would answer only in terms of an indicative ‘range’. The questionnaires were pre-tested with 10 respondents to see if any questions were ambiguous or unclear. Questions that were deemed unreliable were either modified or discarded. Questions were asked in English in a direct way. For example,

Do you feel obligated to send money to family? Would you send more money if you earned a higher monthly income? Do you believe financially supporting your relatives or others hampers your personal success? Are you the first family member to actively support your relatives? Do you believe you benefit from remitting money to family?

Over 140 questionnaire responses were received. These were reviewed and 118 questionnaires met the sampling criteria and were included in the analysis. A number of respondents did not complete all of the questions. For this reason, each item in analysis has a distinct total (n). Because this is a self-selecting sample, it is not intended to be indicative of all people affected by Black Tax. Conclusions cannot be made about all Black Africans or the Black Middle Class. The conclusions should be seen as a first attempt to categorise and understand the functioning of this phenomenon and connect it with the scholarship on financial transfers within families. This study is intended to enable further studies with broader samples and alternative sampling frames.

3.2. Phase 2: six semi-structured interviews

The researcher conducted six in-depth interviews with the intention of supplementing and gaining a deeper understanding of the quantitative data collected in phase 1. The six interviews were collected concurrently with the quantitative data. They were coded and analysed at the same time using the script framework.

Purposive sampling was used for this phase. The researchers used their judgement to actively select respondents that would help answer the research question and meet the research objectives (Saunders & Lewis, 2012). The researchers sought members of the sample that are affected by the Black Tax phenomenon and conducted semi-structured interviews with these individuals. Although it is a small sample, additional insight and varied insights emerged. This was done by selecting interviewees of different ages, different professions, different companies and different genders.

An interview schedule was used to guide the researcher; however, the participants were allowed to talk freely about the topic. The interview guide was pre-tested with two interviewees. All but one of the interviews was transcribed. One was not transcribed in full, but paraphrased because the interview took place in the language of Tshivenda and a decision was made to immediately translate key messages into English. The interviews lasted between 20 and 45 minutes and were all conducted at a place convenient to the interviewee. The researcher took notes of observations made during the interviews. Using Microsoft Excel, the researcher then analysed the content of the transcripts to gain insight into the emerging themes, contradictions and similarities between the quantitative, qualitative data and literature.

4. Findings

4.1. Quantifying the phenomenon

140 questionnaires were collected for analysis; 118 were included in the analysis. The researchers excluded respondents that fell outside the target ages (20–40 years) and excluded respondents who were Coloured, Indian or white. Of the respondents, 8% were between the ages of 20 and 25; 37% were between the ages of 26 and 30; while 55% were between the ages of 31 and 40. The sample selected is largely an early- to mid-career sample, which is indicative of a period of wealth building through savings and investment.

That other race groups completed the questionnaire is indicative of financial transfers not being exclusive to Black Africans. But the researchers wanted to focus on their experience for the purposes of this study. Not all of the questions were completed by all of the respondents. 93% of the survey questionnaire respondents were over the age 26, with the majority, 55%, being between the ages of 31 and 40.

Defining the boundaries of the middle class is difficult. It has been defined in terms of income as those earning R12 644 to R30 328 per month (emerging middle class) and R30 328 to R52 593 per month (realised middle class), regardless of age (Masemola et al., 2012). A significant proportion of respondents can be classified as middle class, with many earning more than these amounts. 39.3% of the sample (n = 117) earned more than R50 000/month; 29.9% of the sample earned between R30 000 and R50 000/month; and 22.2% of the sample earned between R16 000 and R30 000/month. Only 8.55 earned below R16 000, with no respondents earning below R6000/month.

Nearly 78.4% of respondents report remitting to their immediate and extended family, where the extended family referred to grandparents, aunts, uncles, cousins and in-laws, but 69.3% state that they typically send to their immediate family. 86.9% of the sample (n = 99) report remitting to five or fewer people. So although most people report sending money to their extended family, this appears to be most often an inner-circle of the extended family.

Just over 27% of respondents send to rural areas (n = 115) with 42% sending to townships and 29% to cities or suburbs. 75% of the respondents remit funds on a monthly basis (n = 114), 5% weekly, 5% quarterly and 1% annually with the rest, 30% of the respondents, report remitting funds partly or fully on an adhoc basis. Most variable transfers include monthly transfers to immediate family and less-frequent adhoc transfers to the extended family.

Across the entire sample (n = 111), the mean annualised contribution was R32 847 or R2737 per month, excluding adhoc contributions. Adhoc senders reported sending R3127 on average. The majority of transfers happen on a monthly basis. Expectations for when money should be received tracked the relative frequency of transfers. From the questionnaire, those transferring money generally perceive that the people receiving expect more than is sent, especially when transactions happen more frequently. This can result in the experience of transactions being a burden on the person transferring money. This is described further on in the analysis of the interviewees and especially the obligation and blackmail scripts. Those people transferring on an annual or adhoc basis had less of a sense of expectations being higher.

People making financial transfers were generally saving in some capacity. 23% were saving more than R5000/month (n = 118), 16% between R3000 and R5000/month and 27% between R1000 and R3000. 34% were saving less than R1000/month. 85% (n = 117) of the sample were not happy with the amount they were saving each month.

There are various factors that motivate people in the sample to send money to immediate and extended family. Broadly, they either feel obligated to assist financially or feel privileged to be in a position to assist.

73% of respondents felt some sense of obligation to send money, with 14% feeling no obligation. 74% of respondents felt that the funds received were valued, with less than 8% disagreeing. The perception is that demands for financial assistance have increased over time, with 60% of the respondents agreeing. 30% of the respondents believe they can sustain the financial assistance for no longer than six months; 64% believe they can sustain the financial assistance for longer than four years.

71% of respondents believe that financially supporting their relatives hampers their personal success, with 16% believing that it doesn't. Despite this, over 50% however believe that there is a benefit to financially supporting relatives. Close to a quarter of the respondents were neutral, perceiving neither a benefit nor loss that comes with financially supporting relatives. There is balance between those who feel pretty positive about the experience and those who wrestle with the burdens and complexities. 73% of senders (n = 115) report not being the first generation to actively support their relatives, while 27% believed they were.

Funds are used for a wide variety of uses. Most respondents know what the money is intended for. Its reported uses include school fees, transport, groceries, general household expenses, electricity, medical bills and mobile phone costs. While education is one of the more important items on this list, a larger portion of the received transfer is going to essential monthly consumption.

Beyond the additional direct financial support, the people in the sample report assisting their families with transport, funeral donations, groceries, clothes and emotional support. There is an ongoing demand to be there for important gatherings and to participate in decision making on a variety of family issues.

4.2. Understandings of Black Tax

The descriptive statistics above (from 118 questionnaires) give an overview of the issues. This was supplemented by six semi-structured interviews. These interviews were coded using the framework of remittance scripts. Remittance scripts provide a comparative vocabulary that can be employed across time and geography (Carling, 2014). Scripts can be described as structures of shared expectations for specific types of situations. They have been used in other domains such as in the study of life-events (Berntsen & Rubin, 2004; Janssen & Rubin, 2011).

All the interviewees had varying understanding of the concept of Black Tax. Most were articulate in describing how it impacts them and the beneficiaries. The interviewees are described below in Table 2 with allocated names.

Table 2. Overview of the people interviewed.

Allocated name	Background
Ofunwa:	A Black African woman in her early 30s. Born and raised in Soweto. Married with kids. A qualified professional working for one of the largest audit and advisory firms in the world.
Ronewa:	A Black African man in his early 40s. Born and raised in rural Zimbabwe. Married. A senior executive in the retail industry in South Africa
Andani:	A Black African woman in her late 20s. Born and raised in Soweto. Single. A qualified executive working for one of the largest banks in Africa.
Tsumbi:	A Black African woman in her early 30s. Born and raised in Umtata, Eastern Cape. A Chartered Accountant working for one of the largest investment banks in the Africa.
Rudzani:	A Black African woman in her early 40s. Born and raised in rural Limpopo province. Divorced. An economist working for a large insurance firm.
Okhethwa:	A Black African man in his early 30s. Born and raised in Soweto. Single. A middle manager in a subsidiary of a large global pharmaceutical firm.

4.3. Understandings of Black Tax

When asked to articulate their understanding of Black Tax, Ronewa believed it was a responsibility towards immediate and extended family, ‘I look at it as a responsibility that we carry as blacks in terms of extended family and supporting them and looking at family as not only as the immediate family but the extended family as well and continuously supporting them’.

Tsumbi linked it to young and black professionals and the responsibilities they have towards their families and siblings, taking care of all their needs,

So my definition of Black Tax is … the upcoming young professionals, black professionals, who come … from families who aren't financially able to stand on their own two feet. It's essentially either taking your siblings through school, helping your parents pay off their debt that they raised to take you to school, whatever needs to be done, painting the house, whatever it is that your family needs.

Okhethwa linked the term to historical intergenerational kin support. At first, she expressed that she looked it up but was not familiar with it. However, after explaining it, she then explained it as follows,

I learnt about Black Tax from my parents and believe they would have been far or reached a certain level of achievements if it was not of Black Tax. When growing up I do not remember growing up with only my siblings and parents … there was always extended family members living with us.

Ofunwa described it as a burden,

I don't have a broad understanding of Black Tax except from what I’ve heard from people. It's just more of a financial burden really that is experienced by – I wouldn't say the middle class but people who start work but have to support their families at the same time.

Across the interviewees the way that money was distributed depended on who the recipient is. When the recipient was an immediate family member, i.e. mother, father, sibling etc, the financial assistance was more frequent. Ofunwa gave more detail on what money is used for in the broader family,

Okay for the 5 (members of the family) it's usually like school fees, transport money, it's never food, but because it's for my cousins it's usually around school fees and transport money and then for the adults it's usually like bigger stuff, like bonds, DSTV, stuff like that.

Extended family members or those outside the immediate family, as described by Ronewa, are generally assisted for a specific need as and when this arises and the person is alerted to it,

I also send money when there is a family function and all of that, then for those slightly outside the circles … I could get a situation whereby my aunt's child who doesn't have school fees, so I provide that … or my cousins child … he doesn't have clothes or the uniform or whatever - then I provide.

4.4. Scripts associated with the immediate family

Black Tax in its functioning with direct family members, strongly blends script elements of Obligation, Repayment, Help, Blackmail, Pooling and Allowances. There is an ongoing internal negotiation to find an acceptable position between the burdens associated with obligation and the altruistic experience of wanting to help. Is this a good or a bad thing? Who can be supported and who is not? Where does the line get drawn with regard needs that exist?

The obligation script was layered with the repayment script. The sense of obligation results in behaviour of repayment for the perceived sacrifices the recipient made. Ofunwa states it as follows,

Well I was not asked but I was not, not asked. I think it's like, you know if something is a responsibility it's like my daughter is not going to ask me for stuff, so when you know it's something about responsibility you kind of don't wait. So for the house for example, when my mom wanted me to buy the house, I knew she wanted a house, she didn't pressurise me for a house, but I knew that when I get my first job the first thing I need to do is buy her a house.

‘Help’ was induced by a sense of gratitude for perceived sacrifices that parents or other relatives made in the past or currently make. There is recognition around how these sacrifices have provided opportunities for the person to succeed. This brings about a sense of duty in ‘lightening the load’ as Tsumbi put it. Obligation therefore is not only present where there is a sense of entitlement or blackmail, but it can also come from a sense of gratitude and the need to help those that have helped you. As Tsumbi states,

My parents could have taken me to a school where our fees were like R100 a month, but … but they chose to … to go beyond what they could afford at the time … to take me to a ‘better school’. So, in the same way, I don't have to pay my parents back and I don't see it as paying them back, I actually just see it as lightening their load.

There can be a sense of entitlement from family members that believe the sender is obligated to help them. The potential recipient sees the sender as having an obligation to help or uplift them. Ronewa expressed this when he gave an example of how he gets told about a myriad of things that he is expected to help with, whether he agrees with them or not, ‘ … [Y]ou get told about things ranging from any business idea … send me money I want to start a business of buying chicken and selling it’.

Depending on how these funds are solicited, entitlement can also be closely aligned with the blackmail script. Okhethwa states that,

Most people who are disadvantaged always think you have money … There are very few people who still have a lot of money lying around to use, so people who call in the middle of the month and request money and when I say I don't have money. It makes me seem as if I am a bad person.

One experience shared was of the pressure to contribute at any given time, even where the person was not in a position to provide financial assistance. This can invoke a sense of guilt. As Rudzani states around the pressures to contribute beyond one's own means, ‘What do you do with your money? … now sometimes you’d do it and even over compensate even beyond your needs which is not right’.

Pooling is a more empowering position for the sender. Sending money is one of the ways in which each family member contributes to the wellbeing of the family, whether financial or otherwise. Ronewa states this referencing the different roles of his brothers in the family, ‘I’ve got brothers, who don't work but they are there, in each and every family funeral and they dig a grave and whatever – and that's their contribution … so essentially … we are all helping in different ways’.

Allowances were one of the more dominant scripts prevailing in the results. Mainly due to the majority of respondents supporting immediate family on a monthly basis. An allowance implies continuous provision of funds at predictable intervals and that the recipient is mostly free to spend the funds how they please, within implicit limits. Although the recipients are generally not monitored in detail terms of how money is spent, the general expectation is that the funds will cover general household expenses such as clothing, healthcare, utilities and school fees.

Beyond the direct family, there are other scripts that exist in the transfers to extended family members. From a more self-serving motivation, the compensation and investment scripts are evidenced. These can be combined with help, as Ronewa says, ‘I think for me it's only like cows … so I pay that guy because those cows that are not even mine, they were bought by my dad but he left them so it's my responsibility’. The help script is prominent when senders are remitting to extended family. The help script implies a specific, worthy need that the sender will be requested to fund. This places importance on the sender's perception of the recipient's needs.

5. Discussion

In the sample, Black Tax transfers can be interpreted as bundled remittance scripts embedded in a set of culturally shaped but negotiated family relationships. These transfers are relational, material and emotional in nature (Carling, 2014). The transactions are shaped by expectations of culture and tradition, but each individual responds differently and negotiates how to interpret and select among a set of scripts. People in the sample do not simply follow the scripts enacted. The transfer of money to their families is not a reutilised practice. There is a complex ongoing negotiation around what is appropriate. At a societal level, notions of individualism are mixed with traditional forms of collectivism at the family level. Although our research did not focus on it, it would be interesting to understand if there are individuals who may choose not to make such transfers to their direct or extended family.

5.1. Costs and benefits

The results show an overwhelming dissatisfaction with savings’ levels among respondents. Respondents believe that these transfers hamper their ability to save and invest. 28% of respondents are able to save between R1000 and R3000 per month. And 23% of total respondents are in a position to save over R5000 per month.

However, only 15% of all respondents are satisfied with their savings levels. Despite the constant and increased demands being identified as challenges, the majority of respondents feel that these transfers are sustainable, i.e. they will be able to support relatives financially for more than 48 months into the future. Respondents indicated that they would increase the size of the funds as their own income increased.

Despite the negative impacts on one's own success, more than 60% of respondents agree that there are benefits to the transfers and that the experience is beneficial. It can be in the feeling one's sense of satisfaction in improving lives, reducing inequality, in self-insurance, and in strengthening one's reputation at home and in intergenerational links. These are well observed in the literature on inter-household transfers and remitting (Shen et al., 2010; Cox et al., 2013; De Brauw et al., 2013; Fokkema et al., 2013). Most of the benefits are intangible in nature. The most prevalent benefits were around better personal relationships with family members.

5.2. Relational, material and emotional dynamics

The sample studied makes visible some of the ways in which the emerging black middle class makes financial contributions to their families. The transactions in the sample are embedded in relationships. Direct family members benefit more often than the extended family; and the nature of relationships shapes whether there is a response aligned with the script of help, obligation, blackmail or pooling.

Notions of the previous sacrifices made by parents shape the nature of the transaction. Transactions can ‘strengthen social bonds between donor and recipient, and promote family cohesion’ (Cox et al., 2013) as stated by Ofunwa, ‘I think we’d not be as close knit family as we are’.

On an emotional level, the scripts of blackmail, obligation and entitlement can raise feelings of anger or guilt. Blackmail, can be implicitly or explicitly re-enforced with comments that serve to outcast the sender for not ‘putting the family first’. Individuals can feel (or fear being seen as) ungrateful or uncaring.

Many of the respondents indicated a willingness to uphold what they saw as a culture or tradition, the notion of assisting family once gainful employment is achieved. But there can also be conflict between recipient family members (that may be thought of as competing for the financial assistance) or between the sender and recipient. Immediate family tends to receive the larger share of the funds. With the obligation and entitlement script, extended family members may feel it is the respondent's duty to assist them financially.

There can be a difference between the sender's motivation behind sending the money and the recipient's intended use. Conflict arises around the nature of relinquishment. Senders may want to know that their ‘efforts’ are not going to waste. In an open-ended question around how senders feel about the way sent money is used, some stated that ‘I feel like an ATM’ and ‘Angry because I think hard about my expenditure, whereas they sometimes spend recklessly without regard for how hard I work and sacrifice’. Conflict can also occur as there are competing interests with the sender's own spouse/partner and children. There are competing needs at home as well as at work and in the sender's social life.

Lastly, the senders can face internal conflict with him or herself. The sender can feel that Black Tax hampers personal and economic success. Balancing advancing one's own personal growth ambition against cultural and social pressures can create internal conflict. This internal conflict needs resolution. As indicated by Carling (2014), scripts are not followed. They are negotiated as old systems and ways of doing things are discussed internally with oneself and others. Through this reflexive process individual senders try to determine for themselves the actions that are most effective and important for them. The internal and external conversations around Black Tax represent then an attempt to ‘make one's way in the world’ that is substantively different from the one that previous generations inhabited. Tradition on its own is an insufficient guide. One cannot just copy what has worked in the past (Archer, 2007).

6. Conclusion

This study explores the ways in which black South Africans, who are part of the emerging middle class, make financial contributions to their direct and indirect families. This term is often colloquially called Black Tax – a suggestion that it is a financial burden and expectation uniquely experienced by black South Africans. This study represents an initial exploration of the phenomenon. It is not intended to provide a complete understanding. The findings pertain only to the sample and not the general population. It is intended as a starting point for future research. This study specifically focuses on understanding the respondents lived experience. The methodology involved a questionnaire and six follow-up interviews.

Black Tax can be understood as a form of intra-family financial support. In this sample, the phenomenon of emerging black middle class intra-family financial transfers is a significant issue. It represents a large portion of the monthly expenses of the sample. Across the entire sample (n = 111), the mean annualised contribution was R32 847 or R2737 per month excluding adhoc contributions. Adhoc senders reported sending R3127 on average. These individuals are making this contribution largely to their direct families, but including the extended family when appropriate. The contribution is most often monthly, except to the extended family when it occurs in a more adhoc fashion. It is generally an urban-to-urban form of remitting, although there is also a substantive urban-to-rural element. 62% reported remitting to township recipients, 28% reported remitting to surburbs, 18% reported remitting to cities, while 36% reported remitting to rural areas. The main findings are that the transfers are substantive and most often spent on general expenditure and education. At the same time people in the sample making financial transfers are dissatisfied with their own savings levels.

The study demonstrates the applicability of the remittance script framework to these phenomena. The people making financial transfers blend script elements of obligation, repayment, help, blackmail, pooling and allowances. The study demonstrates the economic, social and personal significance of these transfers. We suggest a number of relevant avenues for further research, specifically the economic impacts (on sender and receiver), the social impacts or the more subjective but ultimately workplace and even political consequences for those making financial transfers.

The amounts indicated in this research are not small. The economic impact of these transfers on the recipients in the sample is expected to be substantive. This is largely an unstudied flow of financial support uplifting extended families in the areas of education and general expenditure. It would be important to understand how transfers are being used and whether it is, as indicated here, largely for consumption together with education. Salas (2014) has shown that remittances have a positive effect on human capital investments in the form of attaining a higher quality education for children of immigrants, suggesting that households are likely to send their children to higher quality schools when they receive remittances. Building on work by Shen et al. (2010), it would be interesting to look at the impact of these transfers on lowering inequality.

It would be useful to study on the more general impact of this form of transfer on the sender's financial situation. This is an additional commitment being made by a group of people whose financial position is threatened by a slow-growing, stagnant economy and significant levels of debt. How do these transfers impact on the vulnerability of the black middle class to economic shocks? This could build on the work of Di Falco & Bulte (2011), Hall & Crowder (2011), Jakiela & Ozier (2016) and Shooshtari et al. (2014). Then, because of the substance, the role of these emerging middle-class transfers in cushioning and protecting receivers may also be contributing to the generally low levels of political accountability and weaknesses in governance (Abdih et al., 2012).

It would be important to understand how the financial expectations and family pressures may contribute to a particular emerging black professional workplace and middle-class identity. This can have political implications (Southall, 2004; Ngoma, 2016) or impact on performance in the workplace (Meyer et al., 2014). Links can be made with work around relative deprivation (Pettigrew et al., 2008). It would be interesting to make linkages with the scholarship on late modernity more broadly (Archer, 2007) since the experience in South Africa is likely to be associated with much of the developing world.

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Anthony Wilson-Prangley http://orcid.org/0000-0001-8121-8498