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The oil company Prax Group that collapsed into insolvency last weekend owes the UK government as much as £250mn in unpaid taxes, according to two people with knowledge of the situation.
The people did not identify which Prax company owes the money or whether it relates to one or several entities, however the outstanding debt to HM Revenue & Customs had been part of recent discussions between Prax and the UK government, they said.
A third person confirmed that unpaid tax obligations were part of the discussions but was not able to comment on the amount owed.
UK’s under-secretary for energy Michael Shanks has said that UK government officials were informed about commercial difficulties at Prax’s Lindsey oil refinery at the end of April, and that energy secretary Ed Miliband met Prax chief executive Sanjeev Kumar Soosaipillai in mid-May to discuss how the government could provide support.
Yet Prax was still insisting until last week that the facility on the river Humber in north-eastern England was not at risk of closure, Shanks told parliament this week.
The Lindsey refinery — which produces about a tenth of the UK’s fuel and is one of only five such facilities left in the country — has been placed into receivership, putting more than 400 jobs at risk.
Husband and wife Sanjeev and Arani Soosaipillai founded Prax in 1999 with a single petrol station near St Albans, north of London, and grew it into a sprawling oil company with annual revenues of more than $10bn.
Neither Sanjeev, Arani nor their business have made a statement since the Prax parent company State Oil entered insolvency.
The outstanding tax obligations have not previously been reported. One of the people with knowledge of the situation indicated that some or all of the unpaid amounts related to fuel duties that are paid by suppliers and then generally passed on to customers at the pump.
“There are huge numbers involved in terms of the fuel duties they are meant to pay every month,” the person said.
Prax had been facing liquidly issues for several years before it collapsed. Deloitte seconded a partner to the company in 2023 as part of a streamlining and cost reduction exercise known as Project King.
HMRC said: “For confidentiality reasons we can’t talk about individual businesses.”
A request for comment sent to Soosaipillai’s Prax email address was returned with a message that the founder no longer works for the company. Vladimir Langhamer, Prax’s managing director for Europe, did not immediately respond to a request for comment.
https://www.ft.com/content/67011aaa-4ecd-4462-8022-7bf565a07af3
