W624b spent on corporate cards for 'lavish entertainment' in S.Korea

Signboards are seen in a party district in Jung-gu, Seoul. (Getty Images)

South Korea’s high-end entertainment industry marked 624 billion won ($469 million) in sales with corporate credit cards last year, with over half spent in hostess clubs.

The sales, supposedly generated for entertainment in business dealings, increased by 61 billion won from the previous year’s 563 billion won and accounted for 0.4 percent of total corporate credit card expenditure, according to the South Korean National Tax Service data submitted to Rep. Park Seong-hoon of the ruling People Power Party.

The establishments included in the data refer to ones mentioned in the Enforcement Degree Act on the Regulation of Amusement Business Affecting Public Morals, such as high-end hostess bars and restaurants that include varying levels of entertainment by mostly female staff. Such businesses where staff entertain the customers are allowed by the law, as long as such activities do not lead to prostitution.

In 2023, 341 billion won was spent at hostess bars consisting of private rooms called “room salons” and 131 billion won at “dalanjujeom” where people sing while drinking.

Traditional-style hostess bars called “yojeong,” dinner theaters and nightclubs saw 80 billion won, 54 billion won and 18 billion won in corporate card sales respectively.

Corporate card use in the entertainment businesses decreased from well over 1 trillion won in the early 2010s to 861 billion won by 2019.

With social distancing policies imposed during the COVID-19 pandemic, sales decreased sharply to 212 billion won in 2021. However, the figure has rebounded to three-fold in three years.

By Lim Jae-seong(forestjs@heraldcorp.com)