New Delhi: The Parliament has passed the Finance Bill 2021, giving effect to the financial proposals of the government for the financial year 2022, with the Rajya Sabha giving its nod on Wednesday.

The Lok Sabha passed the bill on Tuesday.

Replying to the debate on the Finance Bill 2021 in the upper house, Finance Minister Nirmala Sitharaman on Wednesday anticipated that India will not see a rating downgrade because of higher spending.

Citing "low inflation, higher GDP growth, record foreign investment and lower fiscal deficit", she defended the government's handling of the economy and came down heavily on the Congress, saying that it was the Congress-led UPA government which left an economic "mess".

The minister claimed that the UPA government's response to the 2008 global financial crisis led to high inflation.

About the GST compensation to states, she said that the compensation likely due to states in FY21 is Rs 77,636 crore.

GST compensation of Rs 2.17 lakh crore is due between April 2020 to January 2021 and back to back loans released to states to meet GST compensation shortfall is Rs 1.1 lakh crore till January 2021, she said.

The Finance Minister also said that the compensation to be released from compensation fund this month is Rs 30,000 crore.

Her speech also featured Bengali, which she spoke to respond to a question from a Trinamool Congress member. However, it was cut short due to ruckus in the house.

In her reply in Lok Sabha on Tuesday, Sitharaman clarified that the equalisation levy will not be applicable on foreign companies who pay income tax in India.

She said that equalisation levy has been imposed to provide a level playing field between Indian businesses who pay tax in India and foreign e-commerce companies who do business in India but do not pay any income tax here.

"We are only trying, through the equalisation levy, to treat everybody who is operating in India equally. If the foreign ecommerce companies pay income tax here, then the equalisation levy is not applicable on them. Hence there is no extra burden on any company," she had added.

Sitharaman said that she intended to clarify through the amendment that equalisation the levy would not be applicable on consideration for goods which are owned by Indian residents.

Through the Bill, the government introduced another amendement fixing a ceiling of Rs 5 lakh per annum in those cases where there is no contribution towards provident fund (PF) by the employer.