Illinois Delays Crypto Tax Amid Industry-Led Court Challenge
The Illinois state government has agreed to delay its digital asset tax for six months as the crypto industry continues to challenge the measure in court. The Digital Asset Tax Act imposes a 0.2% tax on the value of digital assets connected to taxable business activity in Illinois, and it was originally scheduled to take effect on January 1, 2027.
The delay gives crypto businesses more time to prepare as they argue that the structure could create substantial compliance costs due to its reliance on digital asset activity rather than company revenue. Industry groups are also challenging the measure's constitutionality and enforceability, citing potential conflicts with federal law.
Illinois' proposed rules for implementing the tax have been published, but comments are still being accepted through October 30. A separate repeal proposal has been introduced in the Illinois House, although this legislative effort remains distinct from the current court proceedings.