Pritzker signs 0.2% Illinois crypto tax

Governor J.B. Pritzker signed the Digital Asset Tax Act as part of Illinois’s FY2027 budget, imposing a 0.2% charge on the value of digital asset transactions and services provided to Illinois customers. The law takes effect Jan. 1, 2027, and requires service providers to collect and remit the fee to the state.

The levy applies to exchanges, custodians, brokers, wallet services and other digital asset service providers that serve Illinois customers. It targets businesses with a physical presence in Illinois or those that derive more than $100,000 in annual gross receipts from Illinois customers. Illinois officials framed the charge as a privilege tax similar to a sales tax.

Industry groups and crypto advocates criticized the law. The Crypto Council for Innovation wrote on X that the tax ‘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 state.' The Illinois Digital Chamber raised concerns about the statute’s clarity, warning that transfers between wallets, conversions between assets or placing assets in custodial storage ‘could be taxed at 0.2% of full asset value regardless of whether any economic gain has been realized, and even in instances where economic loss occurs.'

Miles Jennings, head of policy and general counsel at Andreessen Horowitz, described the Digital Asset Tax Act as ‘one of the most anti-crypto laws in the U.S.' He added that the law ‘taxes the exchange, transfer, or storage of digital assets — you buy BTC, you pay a tax; you hold your BTC on Coinbase, you pay a tax; and so on.'

Opponents compared the law to a prior federal reporting rule known as the ‘broker rule,' which had broadened reporting obligations for entities that effect crypto sales and was repealed by Congress in 2025 under the Congressional Review Act. Critics also noted there is no comparable state-level financial transaction tax broadly applied to stocks, bonds or derivatives.

Illinois enacted two other crypto laws in 2025: the Digital Assets and Consumer Protection Act and the Digital Asset Kiosk Act, which established rules for exchanges and crypto ATMs. The Illinois Digital Chamber characterized those measures as reflecting industry input and compromise and described the new tax as a departure from that earlier approach.

The lead time to Jan. 1, 2027 gives exchanges, custodians and wallet services time to update systems to collect and remit the fee. Industry groups have requested further engagement with state policymakers to clarify the law’s scope and operational details.