Pritzker signs 0.2% Illinois tax on digital-asset trades

Governor J.B. Pritzker signed Senate Bill 3019 on Tuesday, enacting the Digital Asset Privilege Tax Act and imposing a 0.2% levy on the value of digital assets in covered transactions. The law takes effect Jan. 1, 2027.

The tax applies to the value of the digital asset involved in a covered transaction and assigns the duty to collect to the digital asset broker making or effectuating the sale. Brokers without a physical presence in Illinois become subject when their Illinois sales reach $100,000. The statute requires brokers to register with the state and report transactions. Certain violations of the law are classified as a Class 3 felony.

State fiscal estimates show the new tax and other levies in the budget package will generate more than $800 million to help fund Illinois’ $55.9 billion fiscal 2027 budget. Lawmakers bundled additional revenue measures into the bill package, including taxes aimed at digital advertising, sports betting, cryptocurrency investors and social media.

Industry groups moved quickly to request a line-item veto on the digital asset provision. The Crypto Council for Innovation urged a veto, warning: “This punitive structure would have a profound chilling effect on digital asset activity in Illinois.” Andreessen Horowitz’s head of policy and general counsel, Miles Jennings, called the law “one of the most anti-crypto laws in the U.S.” and added: “It taxes the exchange, transfer, or storage of digital assets-you buy BTC, you pay a tax; you hold your BTC on Coinbase, you pay a tax; and so on.”

Industry representatives argued the levy singles out digital assets while there is no comparable state financial transaction tax on stocks, bonds or derivatives. They warned the charge could prompt firms and developers now operating in Chicago and elsewhere in Illinois to consider relocating to states with different rules. Chicago hosts several crypto and trading firms, including Jump Crypto and Bitnomial.

NetChoice urged a veto of the social media and advertising taxes in the package, citing federal preemption concerns. Legal challenges to parts of the new law are expected before the rules take effect.

Legislative supporters argued the combined revenue measures were needed to shore up the state budget and to capture tax revenue from digital economic activity. State officials said rules and compliance guidance will be published as they prepare for implementation and that brokers will face registration, reporting and collection duties ahead of the 2027 start date.