Illinois has approved a new 0.2% tax on crypto transactions involving state residents, even though industry groups strongly opposed it. Governor JB Pritzker signed the tax into law as part of the $55.9 billion state budget, making Illinois the first U.S. state to tax digital asset transactions regardless of profits or income.
The new “Digital Asset Privilege Tax” will apply to transactions done through registered digital asset businesses and will start on January 1, 2027. Crypto brokers in Illinois will also have to meet new registration and reporting rules.
Groups like the Crypto Council for Innovation and the Digital Chamber say the law unfairly targets blockchain transactions, since there are no similar taxes for stocks, bonds, or derivatives. Critics warn the tax could hurt innovation, push crypto businesses out of Illinois, and make the state less competitive in digital assets.
Illinois is home to several major crypto firms, such as Zero Hash, Jump Crypto, Bitnomial, and Apex Crypto. Tax experts also point out that out-of-state companies with a lot of business in Illinois could be affected by the new law.
Supporters see the tax as a way to help close Illinois’s budget gap and raise over $800 million in new revenue. Opponents say the law comes as federal lawmakers are already working on national crypto rules and taxes. The debate shows the tension between state revenue plans and efforts to create a consistent national approach to digital assets.
Illinois Governor Pritzker just signed the most punitive digital asset tax in the country into law.
This will create an unprecedented tax regime that disproportionately burdens Illinois residents for simply using digital assets and will drive innovation and builders out of the… pic.twitter.com/mYdcMjtA2i
— Crypto Council for Innovation (@crypto_council) June 16, 2026
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