#!perl

use strict;
use warnings;

{ # braces for localization of $/
   local $/ = '<p>'; # end of record is now <p>
   print scalar <DATA>; 
      # first chunk contains everything before first <p> tag, just print
   for (<DATA>) {
      s@([\d\D]*?</p>)@ my $var = $1; $var =~ s!\n! !g; $var @e; 
         # substitute newlines by spaces before the closing </p> tag
      print;
   }
}
__DATA__
This is to test. this is to test
<p>This is to test. This is
to test</p>
<p>This is to test. This is
to test</p>
This is to test.
this is to test