Article 22 of Amending finance law for 1994 provides that the renting of tangible property and the leasing of a means of transport are subject to VAT where the supplier of the service is established in a EU member state and if the lease is assimilated to a delivery. The French Tax Administration, in an Instruction (3 A-5-95) dated 7 April 1995, points out that if the lessee of a means of transport, subject to VAT or not, is established in France, and if the means of transport is used in France or in the EU, the operation is subject to VAT in France. The Administrative comments also provide that if the lessee of movable property other than a means of transport, is established in France without being subject to VAT, and if the movable property is used in France, the operation is subject to VAT in France (article 259 C of the French Tax Code).

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