Explanation:

The composition scheme is an alternative method of levy of tax designed for small taxpayers whose turnover is up to Rs 75 lakh — Rs 50 lakh in the case of eight north-eastern states and the hilly state of Himachal Pradesh. To promote small business, and reduce their tax burden, the scheme provides that:

• While a regular taxpayer has to pay taxes on a monthly basis, a composition supplier is required to file only one return and pay taxes on a quarterly basis.
• Also, a composition taxpayer is not required to keep detailed records that a normal taxpayer is supposed to maintain.

As per the Central GST Act, businesses are eligible to opt for the composition scheme if a person is not engaged in any inter-state outward supplies of goods and not into making any supply of goods through an electronic commerce operator who is required to collect tax at source. Five lakh businesses have opted for the GST composition scheme, which allows them to pay taxes at a concessional rate and makes compliance easy.