We propose a new, very low complexity, single-pass, algorithm for compression of continuous tone compound documents, known as GRAFIT (GuaRAnteed FIT) that can guarantee a minimum compression ratio of as much as 12:1 and even more, for all images in a single pass, while maintaining visually lossless quality when reproduced at resolution 300 dpi or more. The compression ratio is guaranteed in a single pass irrespective of the image being compressed. The complexity of the proposed encoder and decoder is orders of magnitude smaller than all image compression algorithms known today. For electronic compound documents, text is always compressed lossless, and depending on the type of image, the actual compression ratio achieved may be as high as 200:1 or more. For photographic images, while the compression performance is inferior to DCT or wavelet coders, for documents at resolution 300 dpi and above, the quality is still visually lossless. Overall, performance of GRAFIT is highly competitive...