Illinois pushes back start date for crypto transaction levy as court fight continues
Regulation & Gov ·
State officials and industry groups have jointly asked a judge to postpone the 0.2% Digital Asset Tax by six months, moving its effective date to July 1, 2027.
The request, filed in Sangamon County Circuit Court, asks the judge to temporarily halt enforcement of the tax while litigation over its legality proceeds, according to Decrypt. Because both sides submitted the motion together, the outcome is not automatic — a judge still has to sign off before the new timeline takes effect. The underlying case was brought by The Digital Chamber and the Illinois Blockchain Association against the state's revenue director and attorney general, challenging whether the tax can be applied constitutionally.
The levy itself was created under legislation Governor JB Pritzker signed in June as part of Illinois' 2027 budget plan. It applies a 0.2% charge to crypto transactions, including purchases and transfers, with collection duties falling on digital asset brokers such as large exchanges. Lawmakers had projected the measure could generate up to $60 million in 2027. Opponents have criticized the tax's reach, arguing it applies regardless of whether a user actually profits from a transaction.
A second legal challenge is also moving through the same court. The Blockchain Association and the Crypto Council for Innovation filed their own motion on Sept. 9 seeking to block the tax, contending that companies have already poured millions of dollars into compliance systems without adequate direction from state regulators. The Crypto Council for Innovation has separately described the Illinois measure as among the most aggressive digital-asset tax policies adopted by any state.
The dispute in Illinois arrives as federal lawmakers consider changes to crypto tax treatment more broadly. The House Ways and Means Committee recently advanced the Digital Asset Tax Certainty Act, which would remove gain-or-loss reporting requirements on qualifying network fees of $10 or less beginning in 2028, a shift tracked alongside other state-level tax developments by leviathan.news.
What remains unsettled is whether the court will approve the delay and, separately, how it will rule on the constitutional questions raised in both lawsuits. The six-month postponement does not resolve the underlying legal dispute, and industry groups say they intend to keep pressing their challenge regardless of the new timeline.