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Crypto groups challenge Illinois 0.2% digital asset tax in court
The lawsuit, filed in Sangamon County, contests Illinois’ planned Jan. 2027 enforcement and argues the tax is unconstitutionally vague and risks duplicative taxation under the Commerce Clause.
Two crypto advocacy groups, the Crypto Council for Innovation and the Blockchain Association, have filed a lawsuit challenging Illinois’ 0.2% tax on cryptocurrency, saying it violates the US and state constitutions and federal due process rules, according to Cointelegraph.
The groups filed in the Circuit Court of the Seventh Judicial Circuit for Sangamon County, and the challenge comes after Illinois Governor JB Pritzker signed the measure into law in June as part of the fiscal year 2027 budget. The tax is expected to be enforced starting in January 2027 and is structured as a “privilege tax” based on transaction volume rather than income.
According to the complaint, the plaintiffs argue the tax is unconstitutionally vague, placing the burden on residents and brokers to determine how and what assets are taxed under the threat of civil and criminal penalties. They also claim the tax violates the Commerce Clause for interstate commerce, including an argument that it could create the specter of duplicative taxation.
Cointelegraph also notes that the lawsuit followed another challenge filed by the Digital Chamber in July, and it includes comments from the Blockchain Association’s CEO, Summer Mersinger, who said states can support innovation but that Illinois cannot impose a tax regime that discriminates against digital commerce and creates uncertainty.