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Crypto groups seek to block Illinois 0.2% digital asset tax before 2027
The filing asks a Sangamon County Circuit Court for a preliminary injunction, saying compliance would force companies to build costly systems and that Illinois would not benefit from tax revenue during the case.
Crypto lobbying groups have asked an Illinois court to stop the state’s new digital asset tax from taking effect on Jan. 1, 2027. According to CoinDesk, the Crypto Council for Innovation and the Blockchain Association want a preliminary injunction as their legal challenge continues.
The groups argue the tax is pre-empted by federal law and conflicts with the U.S. Constitution. They also say companies could face serious, irreparable harm from having to spend millions to create compliance systems for the levy.
The tax is set at 0.2% and would apply to entities based in Illinois or that provide services in the state, with gross receipts exceeding $100,000. CoinDesk reports that the groups warn the law could also serve as a template for other states if it is upheld.
The filing further contends that Illinois treats digital assets differently from other financial services. CoinDesk also notes Blockchain Association CEO Summer Mersinger said the state would be unable to use any projected tax funds while the litigation proceeds, arguing the state loses little by waiting but companies bear much of the cost.