The crypto industry is opposing a newly enacted Illinois law that introduces a 0.2% tax on businesses handling digital asset transactions or custody services, though near-term changes to the policy appear unlikely.
The legislation applies a 0.2% levy on “receiving any digital asset business activity,” defined as any instance of exchanging, transferring, or storing digital assets on behalf of customers or in the course of business operations.
It covers firms located in Illinois as well as those serving state residents, provided they generate at least $100,000 in gross receipts. One person familiar with the process said the measure is expected to bring in about $60 million in revenue.
The provision was added late to Illinois’ broader budget package and signed into law by Governor J.B. Pritzker on June 16. The overall budget totals roughly $56 billion for the 2027 fiscal year and also includes new taxes on sectors such as fantasy sports and social media.
Some observers say the language may extend beyond crypto assets and could potentially include broader financial activity such as electronic bank transfers.
It remains unclear whether the law can be revised soon, as the Illinois legislature is out of session for the rest of the year. A potential veto session in the fall could offer an opportunity for adjustments, but any action by the governor is uncertain. The tax is set to take effect on January 1, 2027.
Industry participants argue the measure effectively taxes routine digital asset usage and unfairly targets crypto compared with traditional financial instruments like stocks and bonds, which are not subject to similar transaction-based taxes at the state level.
Legal challenges are being discussed as a possible way to contest or modify the law, although no lawsuits have been filed so far.
The development also follows heavy crypto industry spending in Illinois’ Democratic Senate primary, where it supported Rep. Raja Krishnamoorthi against Governor Pritzker’s preferred candidate, Juliana Stratton, who ultimately won the nomination.
Crypto advocacy group Stand With Crypto, backed by Coinbase, has also criticized Stratton’s position on digital assets, assigning her a low rating based on prior public comments about crypto-related campaign activity.
Overall, the legislation marks a shift away from Illinois’ earlier pro-blockchain stance, with critics describing it as one of the most stringent crypto-focused tax measures enacted in the United States to date.
