Taxation of foreign institutional investors has been a grey area and this year the issue had resulted in a lot of upheavel in the stock markets.
The government should bring about more clarity on FII taxation in order to attract foreign inflows into the country, said Suresh Swamy, partner, PwC India.
According to Swamy, the FIIs are waiting for the fine print on the applicability of MAT on FIIs.
Another major issue is the retrospective taxation.
"A lot of money is waiting on the shore to come into India. But the Vodafone amendment is actually hampering the inflows. Specific amendments stating that FIIs and investors in FIIs will not be subject to these amendments will actually see a lot of money coming into India," he said.