Consumer harm related to studios, dresses, and makeup (hereafter SDM) is increasing. Critics say the government needs to establish a statistics-based management system.
According to data submitted by the National Tax Service and the Fair Trade Commission to People Power Party lawmaker Lee In-seon of the National Assembly's Strategy and Finance Committee on the 30th, reports of violations of the obligation to issue cash receipts related to SDM, weddings, and ceremonies totaled 1,178 last year (preliminary). That is about five times higher than the previous year. During the same period, the number of cases caught rose from 125 to 237. So far this year, through the end of August, there were 277 reports and 92 cases caught.
Earlier, on Apr. 4, the Fair Trade Commission enacted a "standard contract for wedding planners" to reduce consumer harm. But it has not been properly followed in the field.
The Korea Consumer Agency (KCA) analyzed the standard contracts of 14 wedding preparation agencies where harm was reported after the standard contract was enacted and six companies surveyed for prices, and found unfair terms in all of them. Nineteen companies listed essential options such as ▲ photo file purchase fees ▲ dress fitting fees as separate items rather than basic services. Thirteen companies did not specify option prices and marked them as "separate."
The KCA plans to share these findings with the Fair Trade Commission. An FTC official said, "The standard contract is only a recommendation to establish a sound transaction order and cannot be enforced on businesses," but added, "We are pushing to revise the notice to require wedding service businesses to disclose their fee structures and refund standards so consumers do not receive unreasonable services."
In addition, SDM does not have its own primary industry code, revealing gaps in oversight. Dress lending falls under "clothing lending business," and studio photography falls under "photo processing," scattering the data. As a result, tax audits, consumer harm reports, and enforcement data are not linked and are managed separately.
For sole proprietors, income from the clothing lending business rose from 45.5 billion won in 2020 to 158.1 billion won in 2023, about a 3.5-fold increase over three years. During the same period, photo processing similarly increased from 48.5 billion won to 92 billion won, about double. Corporations show a similar trend.
A typical tax evasion method detected annually by the National Tax Service in the SDM industry is taking dress fitting fees and extra charges in cash on-site and failing to issue cash receipts. However, cases where such violations of the standard contract are actually reflected in tax audits are not being tallied.
Lee In-seon said, "We pointed out the same problem in last year's parliamentary audit, but the same answer keeps coming back that 'it is difficult to compile statistics because there is no specific primary industry code,'" adding, "Reports of harm on the ground are surging, so the government should swiftly establish a statistics-based management system."