Illinois Agrees to 6-Month Pause On Crypto Tax
PYMNTS | ·
Illinois has reportedly agreed to postpone implementing a new tax on crypto transactions. The tax, the first state levy of its kind in the country, imposes a 0.2% duty on crypto when it is exchanged, transferred or stored. But as CoinDesk reported Thursday (Oct. 1), the new tax may not go into effect on Jan. […] The post Illinois Agrees to 6-Month Pause On Crypto Tax appeared first on PYMNTS.com .
Illinois has reportedly agreed to postpone implementing a new tax on crypto transactions.
The tax, the first state levy of its kind in the country, imposes a 0.2% duty on crypto when it is exchanged, transferred or stored.
But as CoinDesk reported Thursday (Oct. 1), the new tax may not go into effect on Jan. 1 as scheduled, after two industry groups managed to negotiate a delay with the state.
The Digital Chamber and Illinois Blockchain Association reached that agreement with state officials, the Chamber told CoinDesk, though it still needs to be approved by the judge handling those groups’ lawsuit against the state.
According to the report, that approval will mean both sides can focus on the next stage of the legal fight, the “disputed issues of law regarding the constitutionality and enforceability” of the state’s Digital Asset Tax Act.
“We’re pleased that the State of Illinois has agreed to delay implementation of its Digital Asset Tax, giving digital asset businesses and users relief from costly compliance obligations while we continue to seek to have this tax permanently repealed through the courts,” said Digital Chamber CEO Cody Carbone in a statement to CoinDesk.
The report noted that crypto advocacy groups had asked a state court last month to issue a temporary stop, arguing that the industry was already weathering costs to brace themselves for the tax.
Joining in the suit last month was federally chartered cryptocurrency bank Anchorage Digital , which argued in a court filing that new tax would hurt the company’s business and customers.
“Illinois doesn’t tax any other kind of asset this way,” Anchorage Digital wrote in a blog post. “If you move money from your checking account to your savings account you pay nothing. Do the equivalent with crypto, and the state wants a cut .”
Supporters of the tax cite its revenue potential. The Illinois Policy Institute said lawmakers expect the tax to produce approximately $60 million in revenue in 2027.
The Crypto Council for Innovation has described the measure as the “most punitive digital asset tax” in the U.S. and warned that it could lead digital asset companies and entrepreneurs to move to other states.
Commodity Futures Trading Commission Chairman Michael S. Selig said as much in a post on X in July.
“As blockchain technology continues to transform our markets, the choice to plunder crypto wallets rather than promote economic growth may go down in history as Chicago’s last trade,” Selig wrote.
The post Illinois Agrees to 6-Month Pause On Crypto Tax appeared first on PYMNTS.com .