Illinois budget advances crypto transaction tax toward enactment

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Illinois crypto transaction tax

Highlights

Illinois Senate Bill 3019 advances a 0.2% tax on crypto transactions, requiring digital asset brokers to comply or face felony charges and fines up to $25,000.
The Digital Asset Privilege Tax Act, part of a 1,624-page budget bill, could become law pending Governor Pritzker’s expected signature for fiscal 2027, despite industry opposition.
Supporters project the digital asset tax will raise $60 million for Illinois, heightening conflict between tax revenue goals and competitiveness concerns from digital asset associations.

Budget measure outlines tax and broker rules

As reported by the Illinois General Assembly, Senate Bill 3019 passes along party lines early Monday as part of the revenue and tax package for the state's fiscal 2027 budget. The 1,624-page bill includes a 0.2% tax on crypto transactions, to be imposed by the digital asset broker making or effecting the sale of the digital asset business activity.

The measure, framed as a privilege tax under an amendment creating the Digital Asset Privilege Tax Act, also sets registration requirements for entities operating as digital asset brokers in Illinois. Brokers that fail to comply with the rules from Jan. 1 could face a Class 3 felony charge, prison terms of two to five years and fines of up to $25,000.

The legislation remains one step from becoming law because it still needs Pritzker's approval. The governor signals publicly that he plans to sign the budget soon, though he has not yet done so as of Friday morning.

Industry opposition and wider policy stance

The proposal is drawing criticism from digital asset advocates, who argue lawmakers bury the tax provision inside a large budget bill without sufficient notice to the industry. The Digital Chamber and the Illinois Blockchain Association send a letter on Wednesday urging the state to reject the Digital Asset Privilege Tax Act, calling it economically destructive.

In a Thursday post on X, The Digital Chamber says no other state imposes a similar tax and warns that the absence of stakeholder engagement raises significant concerns. Supporters of the budget expect the crypto tax to generate $60 million for Illinois, setting up a clash between revenue goals and concerns about the state's competitiveness in digital assets.

The tax proposal follows another recent move by Pritzker on digital-market oversight. On April 21, he signs an executive order barring state employees from betting on prediction market event contracts through platforms including Kalshi and Polymarket, citing concerns that elected officials could use nonpublic information for personal gain.

Our earlier coverage of Coinbase (COIN) focused on the stock’s sharp decline and the broader selling pressure weighing on crypto-linked equities, even as the company rolled out new derivatives products and secured key regulatory approvals. We also noted that these developments failed to reverse bearish momentum, with analysts highlighting downside risks and key levels traders were watching for potential volatility shifts.

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