Illinois Advances 0.2% Crypto Transaction Tax Proposal, Industry Warns of Damage
Summary
- The Illinois Senate passed a fiscal 2027 budget bill that includes a 0.2%% Crypto Privilege Tax on cryptocurrency transactions.
- The bill includes a requirement for brokers to withhold the tax and criminal penalties of up to five years in prison for noncompliance.
- Industry participants are concerned that the measure could trigger an exodus of companies and investors to other states and put the industry’s survival at risk as transaction costs rise and regulatory burdens increase.
Forecast Trend Report by Period
Illinois is advancing a bill that would impose a 0.2% tax on cryptocurrency transactions. Industry participants say the levy and criminal penalties could undermine the sector’s competitiveness.
Cointelegraph reported on June 5 that the Illinois Senate passed a fiscal 2027 budget bill that includes a provision to introduce the tax.
The measure would impose what it calls a 0.2% “Crypto Privilege Tax” on digital-asset transactions. If enacted, Illinois would separately tax cryptocurrency trades for the first time in the state’s history.
The bill also would require brokers, including exchanges and intermediaries, to withhold the tax. It includes criminal penalties of up to five years in prison for failing to comply.
Industry participants say the measure could push companies and investors to other states by increasing transaction costs and regulatory burdens.
Some in the industry have warned that Illinois’ crypto sector could face an existential threat if the governor signs the bill.
The proposal comes as some US states pursue their own tax and regulatory policies for digital assets, even as regulation is easing at the federal level, fueling friction with the crypto industry.
JH Kim
reporter1@bloomingbit.ioHi, I'm a Bloomingbit reporter, bringing you the latest cryptocurrency news.
