The paper proposes a technique for scalable to lossless audio compression. The scheme presented is perceptually scalable and also provides for lossless compression. It produces smooth objective scalability, in terms of SegSNR, from lossy to lossless compression. The proposal is built around the introduced perceptual SPIHT algorithm, which is a modification of the SPIHT algorithm. Both objective and subjective results are reported and demonstrate both perceptual and objective measure scalability. The subjective results indicate that the proposed method performs comparably with the MPEG-4 AAC coder at 16, 32 and 64 kbps, yet also achieves a scalable-to-lossless architecture.