Dec 26 (Reuters) - India's NSE index fell 1 percent on Monday to a seven- month low, erasing its gains for the year, on worries capital gains taxes would rise after Prime Minister Narendra Modi said market participants should contribute to nation-building.
Finance Minister Arun Jaitley later clarified that the government did not plan to impose long-term capital gains tax, but it was not enough to prevent selling on Monday.
The broader NSE index ended 0.97 percent lower at 7,908.25 after earlier hitting its lowest since May 25. The index is now down about 0.5 percent for the year.
The BSE index closed down 0.9 percent at 25,807.10 after falling as much as 1.1 percent to its lowest in over a month.
For midday report see (Reporting by Tanvi Mehta in Bengaluru; Editing by Subhranshu Sahu)