According to the FY 2027 budget bill passed by the Illinois General Assembly, the state is moving forward with a new tax on cryptocurrency transactions that will apply to digital asset brokers operating in Illinois.
summary
- Illinois lawmakers approved a budget bill that includes a 0.2% tax on cryptocurrency transactions and new registration rules for digital asset brokers.
- Unregistered brokers may face third-degree felony charges, which carry penalties of up to five years in prison and fines of $25,000.
- Industry groups, including the Digital Chamber and the Illinois Blockchain Association, have urged Governor JB Pritzker to reject the measure.
It is included in the state’s $56 billion budget package an offer It introduces a 0.2% tax on cryptocurrency transactions under a provision known as the Digital Asset Franchise Tax Act. Lawmakers approved the measure along party lines on Monday, with only Gov. JB Pritzker’s signature remaining before it becomes law.
State budget documents estimate the tax could generate about $60 million in revenue. Under the proposal, any entity classified as a digital asset intermediary would be required to register with the state before facilitating covered cryptocurrency transactions.
Failure to comply may result in criminal consequences. The legislation stipulates that brokers operate without meeting registration requirements after January 1 may face Class 3 felony charges, which in Illinois can result in prison sentences of two to five years and fines of up to $25,000.
Industry groups have opposed the proposal
Opposition emerged shortly after the Legislative Council approved the bill. In a joint letter issued on Wednesday, the Digital Chamber and the Illinois Blockchain Association urged state officials to reject the digital asset franchise tax law, arguing that the proposal would hurt the local digital asset industry.
The organizations said the measure was introduced without meaningful consultation with industry participants, and noted that no other US state currently imposes a similar tax on cryptocurrency transactions.
Separately, the Digital Chamber said in a post on X that the proposal raised concerns because stakeholders received little advance notice before lawmakers incorporated it into the budget package. The group described the tax as economically harmful, and demanded its cancellation before final approval.
Attention has also focused on the manner in which the measure was carried through the legislature. Critics argued that the cryptocurrency tax was included in the 1,624-page budget bill instead of being discussed as standalone legislation.
States and Congress are increasing scrutiny of digital assets
The Illinois proposal arrives as policymakers across the United States consider new approaches to monitoring and taxing digital assets.
Earlier this year, Gov. Pritzker I fell Executive Order 2026-04 prohibits Illinois State employees from using non-public information obtained through their official duties to trade prediction market contracts or assist others in doing so. According to the governor’s office, the order was intended to strengthen ethical safeguards as prediction markets continue to expand.
A similar measure was adopted in New York a day later when Governor Kathy Hochul signed it Executive Order No. 60which prevents state officials from using confidential government information for personal gain in prediction markets and allows for disciplinary action in the event of violations.
Meanwhile, federal lawmakers are considering separate tax proposals for cryptocurrencies. On June 5, the US House of Representatives Committee on Ways and Means He produced seven drafts for discussion Covers topics including stablecoin payments, staking rewards, mining income, DeFi lending, buying and selling rules, charitable donations, and voluntary disclosure programs for cryptocurrency taxpayers.
According to the committee, the proposals will be discussed during a congressional hearing on June 9, and will build on ideas previously included in the document. Law of equivalence And legislation introduced by Senator Cynthia Lummis.
Governor Pritzker has publicly indicated that he intends to sign the Illinois budget package, although the measure had not yet received final approval as of Friday morning.
