Social Marketing for the Reduction of Tax Evasion: The Case of Electronic Invoicing in Portugal

Abstract

This case study is on a social marketing campaign to decrease tax evasion in Portugal. The main campaign goal was to promote wider general use of invoices with the customer’s tax number. The social marketing campaign is based on marketing incentives to issue an invoice. The incentives involve tax deductions, an invoice lottery (with tax numbers) every month, direct marketing actions, and advertising. The process of generating invoices by traders became mandatory and simplified with certified systems. Customers can show a bar code which can be easily scanned to introduce their tax number in invoices. This process has become culturally accepted and part of the normal sales process. The social marketing intervention decreased VAT tax evasion in priority sectors and is creating a social norm of generating invoices with tax numbers, through tax deduction incentives and an invoice lottery. In the long term, tax evasion as a social norm should be re-evaluated in order to control social marketing effectiveness.