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Crypto Advocacy Groups Sue Illinois Over 0.2% Digital Asset Tax
Two crypto advocacy groups sued Illinois on Friday over its planned 0.2% tax on digital asset transactions, arguing it violates the U.S. Constitution and due process.
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The Crypto Council for Innovation and the Blockchain Association filed a lawsuit Friday in Sangamon County challenging Illinois’ 0.2% tax on digital asset transactions. The suit, filed in the Circuit Court of the Seventh Judicial Circuit, argues the tax violates the U.S. Constitution and due process protections. It separately says the measure conflicts with the federal Internet Tax Freedom Act.
The tax was signed into law by Governor JB Pritzker in June as part of the state’s fiscal 2027 budget. It applies to digital asset transaction volume, not income, and is set to take effect in January 2027. The groups called the tax “unconstitutionally vague,” saying it places the burden on residents and brokers to determine what is taxed under threat of civil and criminal penalties. They also argued it discriminates against interstate commerce and creates the risk of double taxation.