Crypto Industry Groups Resume Legal Challenge to Illinois Tax

Illinois Crypto Tax Faces Renewed Legal Scrutiny

A coalition of industry groups is actively pursuing a summary judgment in their legal battle against Illinois’s proposed 0.2% tax on digital asset transactions. The move comes after state officials agreed to temporarily halt implementation of the tax, initially slated to take effect in July 2023.

Pause Was Temporary

While Illinois paused the tax collection to allow for further discussion, the industry groups—including the Blockchain Association (BA) and the Chamber of Digital Commerce (CDC)—are not satisfied with a delay. They are now seeking a definitive ruling that the tax is invalid. The groups argue the tax places an undue burden on legitimate crypto activity and lacks clarity regarding its application.

Seeking Summary Judgment

A summary judgment would resolve the case without a full trial, if the court finds there are no genuine disputes of material fact. The organizations contend that the tax violates due process and equal protection under the law. The state's initial justification for the tax centered around addressing perceived risks associated with cryptocurrency, but critics argue it effectively punishes participation in the digital asset ecosystem. The outcome of this case could set a precedent for how states approach taxation of digital assets.

Source: Cointelegraph