Automated Market Makers (AMMs) are a decentralizedDecentralization refers to the property of a system in which nodes or actors work in concert in a distributed fashion to achieve a common goal.
Click to read more → exchangeBusinesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies.
Click to read more → protocol that allows users to trade cryptocurrencies without needing traditional order books. Instead of relying on buy and sell orders placed by users, AMMs use smart contracts and liquidityLiquidity indicates how easy it is to convert a cryptocurrency into cashCash is the most liquid form of money: physical coins and banknotes in the most narrow sense of the term.
Click to read more → quickly — and whether this can be achieved without the assetAssets are the resources that an organization can use to generate revenue or benefit.
Click to read more →’s value suffering.
Click to read more → pools to facilitate trades. If the term “Virtual Automated Market Makers (vAMMs)” has emerged since my last update, it could refer to an evolution or extension of the AMM concept with additional virtual or programmable features. These decentralized exchange protocols utilize liquidity pools and algorithms to enable users to trade digitalDigital technologies are these electronic tools that have the ability to generate, store or even process data.
Click to read more → assets directly from their wallets. Popular examples include Uniswap […]
Click to read more →When most people in Africa talk about money stress, family expectations, responsibilities, and financial pressure that doesn’t come from government, there is always one phrase that sits inside that conversation: “Black Tax.” Black Tax is not a government tax. It is not FIRS tax. It is not something you register for.
Black Tax is a financial obligation that many African adults carry, where they must use part of their personal income to support extended family, siblings, parents, cousins, village people, or dependents back home.
It is called “black tax” because although the idea exists globally, it is extremely common among Black communities in Africa, especially first–generation income earners, first graduates in a family, or people who managed to “escape poverty” just a little bitA bit is a basic unit of information in computing.
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It is basically the unwritten, unspoken cultural tax of responsibility.
Simple Definition in Plain Language
Black Tax is money you are expected to contribute to family members or relatives regularly, simply because you are “doing better” financially.
It could be:
- sending monthly allowance to siblings in school
- paying younger brother’s school fees
- sending money to parents every month
- supporting hometown events or family emergencies
- paying rent for a relative
- providing food money to household members
- funding a cousin’s business start–up
- even funding burial or wedding contributions
The pressure is not written on paper, but it is deeply real.
Millions of Africans live inside this situation every month.
Where is Black Tax Mostly Seen?
Black Tax is common in families where:
- One or two people are the only ones earning steady income
- There is generational poverty background
- The family relies heavily on the strongest earner
- The person earning is the first graduate / first to have a good job
- The breadwinner relocated to city or abroad
- Someone secured a better-paying job through education / skill
- Cultural expectation is high, especially for the eldest child
So people who “make it” become the unofficial family bank. This is why black tax is emotional, not financial only. It is linked to culture, upbringing, expectations, survival, and sometimes guilt.
How Black Tax Affects Africans Financially
Black tax is one of the biggest reasons many young African adults, especially youths in Nigeria, cannot save or investInvesting is when you put money in a financial scheme with the intent of making a gain.
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Imagine this:
You earn ₦350,000 monthly.
Each month, before you even enjoy it:
- ₦40,000 goes to siblings in school
- ₦20,000 goes to parents for monthly upkeep
- ₦15,000 goes to someone’s medical issue
- ₦10,000 goes for a cousin’s “urgent something”
At end of month…
You might only see ₦200k left.
Sometimes, even less than that.
So even if you have a good job, your ability to build wealth becomes slow because you are supporting many others.
This is how wealth delay happens.
Many people who could have built assets early, end up using most of their young adult years supporting extended family.
Why Black Tax Exists
Black tax is historically rooted. Most African households did not grow up with generational wealth. They grew up with struggle. So when one person succeeds, they carry the whole ladder.
Why?
Because older generations paid school fees for younger children.
Parents sacrificed food, health, comfort, sleep, just to keep children educated.
Sometimes relatives combined money to support someone through university.
So when that person finally gets a job, there is a sense of repayment.
Not legal repayment, emotional repayment.
This is why black tax is very emotional, not just financial.
Examples of Black Tax in Nigeria Reality
These are real–world scenarios:
| Nigerian Reality Example | Description |
|---|---|
| First graduate in family earns a job | They must send monthly home support |
| Youth Corps member earning NYSC allowee | Still sends small “tokenA digital unit designed with utility in mind, providing access and use of a larger crypto economic system. Click to read more →” home |
| Worker in Lagos supports parents in village | Monthly feeding money |
| Uncle contributed to school fees | Now expects financial “returns” |
| Eldest child automatically becomes provider | Culturally positioned caretaker |
Even people who earn very small still get requests.
Black tax does not consider your bills, it considers your title.
Difference Between Black Tax and Official Tax
| Black Tax | Official Government Tax |
|---|---|
| Cultural pressure | Legal obligation |
| Paid to family | Paid to government |
| No law enforces it | Law enforces it |
| Based on emotion & expectation | Based on income, profit, business revenue |
| Continuous and unpredictable | Calculated based on fixed rules |
| Difficult to refuse | Refusal leads to conflict, not jail |
Many people feel black tax more than FIRS tax.
Some Nigerians fear “family expectations” more than FIRS letters.
Positive Side of Black Tax
Even with the stress, black tax has benefits.
- It builds community
- It helps lift multiple family members into education
- It spreads resources across family
- It acts as social safety net in countries with weak welfare systems
- It keeps people from starving or dropping out
In Africa, family is the first insurance system. Government welfare is limited. So black tax helps many households survive. Some people ONLY finished school because their elder siblings funded them. So black tax can produce generational uplift, if properly structured.
Negative Side of Black Tax
However, black tax can delay wealth creation for the person paying.
- It slows personal investment
- It creates burnout
- It creates resentment
- It traps some earners in endless cycle
- It makes people feel guilty when they say “no”
- It reduces ability to grow into middle class early
It is one of the biggest reasons many African adults in their 20s and 30s fail to build emergency funds.
If 20% to 40% of your salary goes to extended family monthly, your net worth will grow slower.
Some people even borrow to fulfil black tax. That is where it becomes financially dangerous.
Black Tax vs Responsibility
Some people confuse black tax with normal family support.
There is a difference.
| Regular Family Support | Black Tax |
|---|---|
| Based on ability | Based on expectation |
| You choose what to give | You are pressured to give |
| Can be planned | Mostly unexpected requests |
| Comes from love | Comes from cultural obligation |
| Does not destroy your budget | Sometimes destroys your budget |
Black tax becomes toxic when:
- you are forced to choose between your rent and extended family demands
- you feel ashamed to invest in yourself because relatives need money now
- you can’t say NO without being labelled selfish
That emotional guilt is the core pain point of black tax.
Why Young Nigerians Talk About Black Tax a Lot Today
Two major reasons:
Cost of living is rising
Rent, food inflationA general increase in prices and fall in the purchasing value of money.
Click to read more →, transportation, school fees, everything is expensive.
So income feels smaller.
Generation Z & Millennial mindset is shifting
Young adults want to:
- travel
- invest
- pursue career goals
- build retirement early
- build savings
- become property owners
But older generations prioritise survival.
Older generation: survive now, younger generation: build for future. This clash creates stress.
The Emotional Psychology Behind Black Tax
Black tax triggers emotions like:
- guilt
- shame
- fear of being called wicked
- fear of family rejection
- pressure to maintain reputation
- cultural pride
Final Words
Black Tax is not a government tax, it is a cultural expectation that people who are financially stable should support family members who are not.
It is rooted in community, survival, sacrifice, and shared responsibility.
It can be positive, when managed well, because it lifts entire families out of poverty.
But it can also limit financial growth, especially when the demands are excessive and unstructured.
Understanding black tax helps us approach family support more wisely, so we don’t destroy our own financial future while trying to help others in the present.
The key is balance: help your family, but don’t forget to build your own financial foundation.