Illinois Crypto Tax Gets Served: Digital Chamber Takes 0.2% to Court ⚖️

The Digital Chamber has filed suit in the Sangamon County, Illinois circuit court seeking to block the state's Digital Asset Tax Act before its scheduled Jan. 1, 2027 effective date, becoming the first crypto trade association to take a state tax law to court. The complaint, filed Tuesday, names Illinois Attorney General Kwame Raoul and Department of Revenue official David Harris as defendants and argues the 0.2% levy on certain digital asset business activity is "facially invalid."

According to the filing and a Digital Chamber blog post, the group alleges the tax "discriminates against people who transact in digital assets" because it is "universally applied, regardless of whether the investor realizes any gain, or whether ownership is even being transferred." The Chamber further contends the provision was "slipped into the state's budget" without debate or input from affected parties.

The tax was enacted as part of Illinois' fiscal year 2027 budget bill, signed by Governor JB Pritzker in June, and applies to crypto brokers, who could face prison time and fines for noncompliance. In a Tuesday post on X, the Digital Chamber wrote that "no one should be taxed differently because of how ownership of digital assets is recorded or transferred" and said it is inviting other industry stakeholders to join the litigation.