- Illinois approved a 0.2% tax on crypto-related transactions.
- The tax will take effect on January 1, 2027.
- Exchanges and service providers will be responsible for collecting it.
- Industry groups argue the law could hurt innovation.
Illinois Governor JB Pritzker has signed a new law that will impose a 0.2% tax on digital asset transactions and related services provided to Illinois residents.
The Digital Asset Tax Act will take effect on January 1, 2027, and will primarily apply to crypto businesses such as exchanges, brokers, custodians, and wallet providers operating in the state.
Industry groups have strongly criticized the measure. Organizations including the Crypto Council for Innovation, Digital Chamber, and Illinois Blockchain Association argue the law could discourage innovation and drive crypto companies away from Illinois.
One major concern is uncertainty around how the tax will be applied. Critics say the language could potentially create taxes on asset transfers, wallet movements, or storage services even when users generate no profits.
Andreessen Horowitz policy leaders described the legislation as one of the most anti-crypto laws introduced in the United States, arguing that crypto is being singled out in a way not seen with traditional financial assets such as stocks or bonds.
Supporters view the measure as a way to generate additional state revenue, while opponents fear it could make Illinois a less attractive location for crypto businesses and investors.
