The “black tax” upsets our finances


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If you’ve only caught a glimpse of a news broadcast recently, you’ll know that any attempt to avoid talking about the cost of living crisis and its crippling consequences is futile.

The risk of financial insecurity hangs over large swaths of the country, with around 46 million people saying their spending increased between March and June this year. Soaring fuel, food and energy prices mean people are spending less on non-essentials. At the same time, the value of the pound fell. So it’s no surprise that a recent Office for National Statistics (ONS) survey found that 77% of adults are ‘very’ or ‘fairly’ worried about money.

For black professionals living and working in the UK, the grim economic forecasts are compounded by income disparities, the racial pay gap and what has been dubbed the ‘black tax’.

This term describes the responsibility often attributed to first and second generation black immigrants, who choose to send money to relatives living “at home”. This also applies to those who support older family members in general – including those who were born, raised and live with their families in the West.

Rusheen Hemley, 29, did not expect her to take primary responsibility for her family’s finances. But after her mother, a former carer, suffered an injury at work and was unable to work for an extended period, she moved from London to Birmingham where she was needed.

Currently, she covers about 70% of household bills and expenses while working as an operations manager at a delivery company. Her mother, who now works part-time, takes care of the rest.

Although she doesn’t mind having to supplement her mother’s income, she admits that she had to temporarily sacrifice her own plans.

“I feel like going back to Birmingham means I’ve taken a step back, whereas if I had continued in the role I had in London I would have been a bit further ahead,” he said. she told HuffPost UK. “It also made me take a step back from saving to buy property.”

But his financial obligations do not stop there. Hemley also has family in Jamaica, where she was born, and with her mother she arranges for monthly payments to be sent to her grandmother, as well as two large barrels of clothes and toiletries, which they mail to parents twice a year.

“They are counting on us to help them, especially since some of them are unemployed and have difficulty finding a job,” she explains. “A lot of their children are in school, which they have to pay for.”

Rusheen Hemley supplements her mother’s income and sends funds to her family in Jamaica.

You may think that other ethnic groups also send remittances (money to family abroad), which is true. In fact, India is estimated to have received the most remittances from the UK in 2018 at £3 billion, followed closely by Nigeria. But the UK’s black population occupy some of the most economically disadvantaged positions in the country.

ONS figures show that 45% of households in the UK had a weekly income of less than £600 (before tax) on average between April 2018 and March 2022. Of all ethnic groups, black households were the most likely to fall into this category.

Figures also show that between 2013 and 2021, black employees had the second lowest hourly earnings each year (£12.55) behind the Pakistani/Bangladeshi ethnic group (£12.03).

Blacks (along with Bangladeshis and Pakistanis) also had the highest unemployment rate of any ethnic group (8%) in 2019, double the rate for whites. Black Africans also have the second lowest home ownership rate (20%) behind the Arab ethnic group (17%).

Things get worse when you consider that the black tax is directly impacted by the cost of living crisis, both for those sending money and for those receiving it. Indeed, rising inflation is a global problem, which means that the £100 you were sending to your loved ones in Africa or the Caribbean this time last year won’t stretch that far for them today.

“It’s like paying a tax in the form of inflation here and paying it again at home because inflation is also very bad [in other countries]says Dr. Ayobami Ilori, lecturer and tutor in economics at the Open University.

“So it’s more of a double whammy if you ask me, because even if you send the exact same amount that you were sending before, he’ll never be able to meet the needs he was having before.

“There will now be a lot of pressure, especially on first and second generation migrant workers – those with immediate families in foreign countries – to send more money home even when they are not earning. enough. And I expect that will probably force a lot of people to start looking for alternative jobs or even take on more shifts and more work.

Chidera Peters has experienced first-hand how inflation can eat away at funds budgeted to support the family. Originally from Nigeria, the 26-year-old now lives in Hertfordshire and works in the fintec industry. She first moved to the UK in 2019 for her studies.

“As soon as I started my studies, I worked part-time and sent a certain part of my income home to support my family with household expenses and also school fees”, she says.

“After I finished university I could work full time, so I obviously increased the allowance I sent, because I felt like I was earning more, so I would have to do more at home. But the cost of living [problem] is not just in the UK. In Nigeria, for example, it is increasing. So the money I sent in January can’t buy the same amount of stuff now.

Chidera Peters says inflation is impacting the remittances she sends to her family in Nigeria.
Chidera Peters says inflation is impacting the remittances she sends to her family in Nigeria.

She says her immediate family are aware of rising costs in Britain and are not pressuring her to send them money. Outside of his parents and siblings, however, people didn’t always take the same attitude.

“From the extended family, there is a certain level of entitlement. It’s like ‘Oh you’re in the UK, you’re better off, you’re supposed to help everyone back home,’” she says. “But from my immediate family, I don’t feel that. I can literally tell them that I can’t send money this month and everyone is fine.

The challenges posed by the current economic climate mean more than ever that we must prioritize our own responsibilities. This is emphasized by Selina Flavius, financial coach and founder of Black Girl Finance.

“You might give up on your own goals, dreams, wants, and needs so you can support others. Look around and start having honest conversations about who you might be able to share the load with,” she says. “Right now it’s all about keeping the lines of communication open and being aware of the impact the support of others has on you.”

It’s too early to tell how much the cost of living crisis will affect people like Hemley and Peters – young black workers doing their best to provide for their long-term loved ones. But it is not difficult to predict the ripple effect this will have on older and potentially more vulnerable parents, as well as those in developing countries with fewer resources who depend on the generosity of their young parents. .

Although she’s concerned about being able to afford it all — “A few days ago I was telling my husband that I think I need to ask for a raise” — Peters plans to continue sending money to her family in Nigeria.

“I might end up reducing the amount I send home, but I can’t see myself deciding not to send at all,” she says. “So it’s just about trying to manage my expenses and cut the cost of other things where I can, so that I’m able to cope.”

What does it mean to be black and British? Well, that depends on which generation you ask. This Black History Month, HuffPost UK has teamed up with BuzzFeed’s Seasoned and Tasty UK to find out. Learn more about Gen:Blxck here.


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