This couldn't actually BE tar or something -could it?
I hardly dare ask this but when was the last time someone even touched this poor little scrap .........because for this to be this bad I cannot even bear the amswer.
All I can say is Please get him to the vet as he would be in a very miserable state and I am sure you agree that he deserves some relief.
And or if you do not want him ! take him to the dogs home.
I do so hope I have got this all wrong.Please let us know how you go
When flea irritation goes on a long time, untreated, it can leave the skin dry, crusted thickened and irritable. It might not be this of course, as there are other conditions that present with skin problems.
Does he scratch at this a lot? Has he lost hair in that area?
If this IS a flea allergy/irritation, it needs urgent treatment, as what you describe means it has gone on a long time and has caused a lot of damage.
I would get the vet's opinion on this and some treatment soon.