Digital Chamber sues Illinois officials over new state 0.2% crypto tax
Reported by Cointelegraph · AI-assisted summary by ChikoCorp AI News Desk
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The Digital Chamber, a cryptocurrency and blockchain advocacy group, has filed a lawsuit against the State of Illinois over a new 0.2% tax on cryptocurrency transactions set to take effect in 2027. The suit was filed in the circuit court of Sangamon County, Illinois, and targets Illinois Attorney General Kwame Raoul and Department of Revenue official David Harris. The Chamber argues that the tax, which was included in the state budget without public debate or feedback, is "facially invalid" and discriminatory.
According to the Digital Chamber, the tax unfairly targets individuals based on the method of recording or transferring ownership of assets. They claim the tax is imposed universally on all digital asset transactions, regardless of whether the investor profits or if ownership changes hands. This means the tax could apply even without any realized gain from the transactions.
The new tax policy was incorporated into a Senate bill as part of Illinois' fiscal year 2027 budget, which Governor JB Pritzker signed into law in June. The legislation requires crypto brokers to collect the 0.2% tax on transactions, with noncompliance potentially resulting in prison time and fines. The Chamber's legal challenge focuses on the process through which the tax was enacted and its implications for crypto investors' rights.