It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
The government started to address the problem by issuing mandatory receipt machines – known here as fapiao – which would record each transaction and could not be manipulated. Government officials could periodically check the machines to get a true picture of sales activity. The problem: businesses would simply refuse to use the machine. This is an issue of information asymmetry; short of stationing government monitors at each business, it was simply impossible to get accurate sales figures.
So China introduced a novel tactic: lottery tickets.
The government officially made each fapiao receipt a lottery ticket as well, in an attempt to compel customers to demand the receipt from businesses. The tickets are free for the customer and can in some cases win the holder up to 5,000 yuan.
So far, the lottery receipts seem to be working. Using data from the program’s early years, Wan found that overall tax revenue and revenue in areas with the program was significantly higher than in areas without it. A report by the China Taxation Bureau from 2002, for instance, when the program was still in an experimental stage, showed that the total prize money was 30 million yuan ($4.88 million), compared to an estimated increase in tax revenue of 900 million yuan.