indeed, and the MOT on diesel vehicles involves a fuel test to check for red diesel. the dye stays in the system for years and if you're caught using it you will be prosecuted for tax evasion. it's mainly used in agricultural vehicles.
and used in marine diesel engines as well since. However that law has just changed since the E.U. got it's knickers in a twist over us Brits having this lower tax than that of Europe...bottom line is that red diesel will soon be taxed at normal rates (for pleasure craft only at the moment, not fishing vessels) hence go from 30p per litre to over 80p+ although some cheeky sod was selling for �1.20 the other day on the Thames!