“Get them tax audited NOW” — Fans furious over HYBE’s alleged huge “tuition fee” charges for affiliate labels

DealSite reported that HYBE Corporation charges a high "tuition fee" from its subsidiary labels except for BIGHIT MUSIC. On November 8, 2024, reports surfaced that BIGHIT MUSIC (renamed HYBE Labels under HYBE Corp.) earns the highest revenue for the parent company due to BTS' global popularity.

BIGHIT MUSIC made 280.1 billion won (about $202 million) in sales in 2023. However, in 2024, sales dropped to 164.7 billion won, a 41.2% decrease, likely due to BTS' ongoing enlistment. Net profit also fell by 36.6%, from 75.7 billion won ($54.5 million) in the first half of 2023 to 48 billion won ($34.6 million) in 2024.

DealSite reported on November 8, 2024, that except for BIGHIT MUSIC, other subsidiaries pay the parent company music distribution fees, service fees, etc. as a form of "tuition" for artist training.

Reportedly, in 2023, ADOR paid 15.7 billion won ($11.4 million) in tuition, Source Music (LE SSERAFIM's label) paid 11 billion won ($7.95 million), and BELIFT LAB (ENHYPEN's label) paid 14.4 billion won ($10.4 million) in tuition.

However, it is crucial to note that in 2023, BIGHIT MUSIC reportedly paid 38.6 billion won (approx. $27.8 million) in purchase price fees to HYBE. In the 2024 second half, the label is expected to pay $17.8 million in purchase price fees to its parent company.

Fanbases were stunned over the breaking news and demanded that the parent company should get "tax audited" immediately. One X user wrote:

"Hybe is fraudulence from head to toe. Get them tax audited NOW"

A netizen commented on HYBE's alleged fees for subsidiary labels. (Image via X/@strawberrymccns)

Netizens flocked to X to lash out at HYBE's alleged partiality towards BIGHIT MUSIC while the parent company charges high tuition fees from all its other affiliates.

"HYBE is reportedly charging ADOR the highest "tuition fees" but providing the lowest "internal revenue" compared to other sub-labels, suggesting a potential financial imbalance within the company." one fan wrote.

"Hybe needs to be tax-audited as soon as possible," another X user stated.

"Hybe has been overcharging ador for their non existent “services” that were partially used to slander newjeans. the girls have basically been paying the pig to be defamed by his dogs. hybe WILL be tax audited & it will be revealed where all that money really went," one other user wrote.

Several netizens urged others to "keep signing the petition" to remove the company's 'Top Company' status. For the unversed, over 48,000 people have signed the petition on the official site of the National Assembly of South Korea against the parent company's 'conglomerate' and 'Top Company' to offer jobs statuses.

"Keep signing the petition Knetz to get Hybe tax audited we’re at 93% until it’s sent officially for review," one X user said.

"HYBE needs a complete restructure. The way they are operating is not only incompetent, it's also immoral. Thugs, bullies, and greedy people who couldn't care less about music. Please, they need a do-over!!" another user added.

"AND THAT IS WHY THEY ARE FACING KARMA," one other fan said.

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BELIFT LAB reportedly pays the highest tuition fees to HYBE

As per DealSite's report, BIGHIT MUSIC's internal transactions with HYBE in 2023 were over 134.8 billion won (approximately $97.1 million). As per the company's Q3 2024 Earnings Report, it was 24.4% of the parent company's 2023 annual revenues of 552.3 billion won (approximately $398.2 million).

Reportedly, in 2024, Pledis Entertainment—home to SEVENTEEN—paid 29.3 billion won ($21.1 million) in internal transactions, BELIFT LAB (ENHYPEN) added 9.3 billion won ($6.7 million), and Source Music (only group LE SSERAFIM) contributed 3.5 billion won ($2.5 million).

ADOR contributed 3.1 billion won ($2.2 million) with its only group NewJeans' sales, and KOZ Entertainment paid 200 million won ($1,44,183.12) with its only group BOYNEXTDOOR's sales as the parent company's internal transaction, as per the report.

However, among all the subsidiaries, BELIFT LAB reportedly pays the highest tuition fees for ENHYPEN and ILLIT's internal transactions compared to Source Music and ADOR. The label showed the most aggressive growth among all subsidiaries compared to 2022 and 2023. Through ENHYPEN's sales, BELIFT LAB earned over $65.8 million in 2023.

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Currently, the parent company is facing backlash for its leaked 18,000-page internal report containing disparaging remarks on rival K-pop groups' visuals, physical appearances, and popularity.