Illinois Agrees to 6-Month Pause On Crypto Tax

Illinois has decided to delay the implementation of a new tax on cryptocurrency transactions for six months. The tax, the first of its kind in the United States, would have imposed a 0.2% duty on crypto when it is exchanged, transferred or stored. However, two industry groups, the Digital Chamber and Illinois Blockchain Association, successfully negotiated a delay with state officials.

They reached an agreement with the state, though it still needs to be approved by the judge handling their lawsuit against the state. The approval means both sides can focus on the next stage of the legal fight, namely the "disputed issues of law regarding the constitutionality and enforceability" of the Digital Asset Tax Act. The Digital Chamber's CEO, Cody Carbone, expressed relief for digital asset businesses and users due to the delay, which will provide them with relief from costly compliance obligations.

Crypto advocacy groups had requested a temporary stop from a state court last month, arguing that the industry was already facing costs due to the impending tax. Anchorage Digital, a federally chartered cryptocurrency bank, joined the lawsuit last month, stating that the new tax would harm the company's business and customers. Supporters of the tax claim that it could generate approximately $60 million in revenue for the state in 2027, while crypto industry groups argue that it is the "most punitive digital asset tax" in the U.S. and could force digital asset companies and entrepreneurs to relocate to other states.