Illinois Enacts Nation's First Digital Asset Transaction Tax

Illinois Governor J.B. Pritzker signed a $55.9 billion state budget on Tuesday, June 16, 2026, enacting the nation's first transaction-based tax on digital assets. The new law imposes a 0.2% levy on digital asset business activity, including exchange, transfer, and custody services, and is scheduled to take effect on January 1, 2027.

The provision, known as the Digital Asset Privilege Tax Act, was included in Senate Bill 3019 as part of a broader revenue package. State officials estimate the tax will generate approximately $60 million, contributing to a total of over $800 million in new tax revenue for the fiscal 2027 budget. The law requires digital asset brokers operating in Illinois to register with the state's Department of Revenue and file monthly reports on covered activity.

Industry groups, including the Crypto Council for Innovation and the Digital Chamber, strongly opposed the measure, urging the governor to veto it. In a letter sent on June 16, the Crypto Council for Innovation described the law as "the most punitive digital asset tax in the country" and warned it would "drive innovation and builders out of the state." The groups argue the tax uniquely targets digital...