Illinois has added a 0.2% tax on digital asset business activity to its state budget in a late-stage change that industry sources say is unlikely to be revised anytime soon.
The levy applies to companies that exchange, transfer, or store digital assets for customers, and covers firms operating in Illinois or serving residents with at least $100,000 in annual gross receipts. It is expected to generate about $60 million in revenue.
People familiar with the process said the provision was inserted during final budget negotiations and signed into law by Governor J.B. Pritzker on June 16. It is part of a broader $56 billion fiscal 2027 budget that also introduces new taxes on sectors including fantasy sports and social media.
The crypto industry has sharply criticized the measure, arguing it unfairly targets digital asset firms by imposing a transaction-based tax not applied to comparable financial services. Some observers have also questioned whether the language could extend beyond crypto to cover broader digital payment activity.
With the state legislature out of session for the rest of the year, chances for near-term changes appear limited. A veto session in the fall could offer a potential opportunity for adjustments, though it is unclear whether the governor would act. The tax is scheduled to take effect on January 1, 2027.
Industry groups, including the Crypto Council for Innovation, say the policy effectively singles out crypto and creates an uneven playing field compared with traditional assets such as stocks and bonds.
Some stakeholders believe litigation may be the most realistic path to challenge the law, although no legal action has been filed yet.
The tax comes amid a tense political backdrop in Illinois following a competitive Senate primary in which the crypto industry spent heavily supporting a candidate who opposed Governor Pritzker’s preferred choice, Lieutenant Governor Juliana Stratton, who ultimately won.
Crypto advocacy group Stand With Crypto, backed by Coinbase, had previously assigned Stratton a low rating on digital asset issues, citing her criticism of crypto-funded campaign spending.
The budget measure contrasts with earlier, more crypto-friendly legislation in Illinois, with critics describing the new tax as one of the most aggressive digital asset levies enacted in the U.S.
