Black market diesel probed

PUBLISHED : Friday, 03 February, 1995, 12:00am
UPDATED : Friday, 03 February, 1995, 12:00am

THE findings of a Customs and Excise investigation into the size of the diesel oil black market will be presented to the Government before the Budget speech, customs deputy director Lawrence Li Shu-fai said yesterday.

The department is conducting a study into the size of the problem which is believed to be costing the Government millions of dollars in lost duty each year.

The duty doubles the price to the consumer and has created the black market.

The results will be handed over before March 1, enabling Financial Secretary Sir Hamish Macleod to consider the financial implications of the current duty rate of $2.45 a litre.

Last year, Sir Hamish increased the duty by 8.5 per cent to keep pace with inflation after ruling out a tax cut due to increasing traffic congestion.

Customs officers seized 520,666 litres of illegal diesel last year, an increase of 285 per cent on 1993.

The growing diesel black market was singled out by Commissioner for Customs Don Watson last month as one of the major worries for the department in the year ahead.

Duty is paid on diesel unless it is for industrial or marine use. Duty payments are being avoided by smuggling from the mainland and by illegally using non-dutiable fuel.