Ukrainian government told to fix fake fuel problem

Pressure groups have warned the Ukrainian government that raising fuel taxes will push people to sell more bootleg petrol.

Plans to raise tax on fuel to pay for road infrastructure improvements have met with opposition, Interfax-Ukraine reports. A doubling of excise duty on petrol and diesel is planned, but experts at a press conference warned such an action will fail to bring more money into government coffers.

"The higher the price, the more incentives there is for supplying bootleg gasoline, and in the past three years the state has not monitored the quality of fuel," Oleksandr Sirenko, from UPECO Consulting Company, said.

Another expert at the press conference said at the end of last year the Ukrainian Finance Ministry put the amount of fake fuel traded in the country at 900,000 tonnes. If fuel taxes go up before the government fixes the bootleg petrol problem, many fear the black market will grow larger still.