Illinois Imposes 0.2% Tax on Crypto Assets Transactions

The state of Illinois has enacted a law imposing a 0.2% tax on activities related to digital assets. This development is stirring significant concern within the crypto industry, which argues that the legislation creates an unlevel playing field for cryptocurrency companies. Such a move might even prompt legal challenges.
The legislation targets every instance of exchanging, transferring, or custodial storing of digital assets when these services are offered as part of business activities or on behalf of clients. It applies to companies registered in Illinois and providers serving state residents with gross revenues exceeding $100,000. According to estimates, this new tax could generate about $60 million annually for the state’s budget.

A Last-Minute Legislative Addition

According to sources familiar with the legislative process cited by CoinDesk, the provision concerning crypto taxation was added literally just before passing a comprehensive budget bill. Governor J.B. Pritzker signed the document into law on June 16th.
This law shapes the state’s budget for the fiscal year 2027, amounting to around $56 billion. It also introduces new taxes in other sectors such as fantasy sports and social media.
However, experts are concerned about the broad wording of this document. For instance, Professor Austin Campbell from New York University noted that this law might potentially extend beyond crypto assets to encompass certain forms of digital payments.

Crypto Industry Prepares for Resistance

In a letter addressed to Governor Pritzker, the Crypto Council for Innovation (CCI) pointed out that Illinois essentially introduces a separate tax solely targeting the digital asset sector.
“Unlike traditional taxation models, this law imposes a 0.2% tax on everyday use of digital asset services – exchange, transfer or custodial storage,” stated CCI.
The organization emphasized that there are currently no similar taxes on stock trading operations or other financial instruments at the state level in the U.S.
The CCI also urged Governor Pritzker to partially veto this provision in the legislation. However, since the legislative session has concluded, prospects for amendments remain uncertain.
Sources indicate that representatives from the crypto industry are already discussing potential court challenges against this new law. Although no lawsuits have been officially filed yet, litigation is considered one of the most realistic avenues for revisiting these new rules.
Reflecting back to October 2025 highlights another instance where authorities proposed taxing mining activities due to increased energy consumption in New York City – underscoring ongoing regulatory challenges faced by cryptocurrency markets today.