Composition levy is an alternative method of levy of tax designed for small taxpayers whose turnover is up to ₹ 1.5 crores (Seventy-five rupees lakhs for special category States, excluding Jammu & Kashmir and Uttarakhand). It is a kind of turnover tax.
The prime motive of the scheme is to provide a simplified tax payment regime for the small taxpayers. It is optional and is mainly for small traders, manufacturers and restaurants.