The entire lease payment is out of pre-tax salary of employees of a company. Accordingly, the entire vehicle EMI provides a tax reduction and increases the take index salary. Assume that an employee draws a salary of INR 1 lac per month and EMI for his car is INR 20,000. In a non-lease situation his tax outflow per month is calculated on INR 1 lac i.e. his tax outflow will be INR 30,000 per month (approximately). However, in a lease situation, the tax will be calculated only on INR 80,000 (INR 1 lac salary less Lease EMI which is tax deductible) i.e. tax will be only INR 24,000. Thus the net take index of the employee will be INR 50,000 in a non-lease situation and in a lease situation the net take index shall be INR 56,000. Take index salary increases by 12%.