To address the unfair tax burden that would be imposed under the Digital Asset Tax Act included in the recent Illinois state budget, The Digital Chamber (TDC) filed a lawsuit today in Sangamon County asking the court to halt the last-minute tax provision slipped into the state’s annual spending bill. The suit seeks to stop the tax from adversely affecting TDC’s members, who are already incurring costs trying to comply with the new tax ahead of its expected January 2027 effective date.

The lawsuit argues that no one should be taxed differently because of how ownership is recorded or transferred. Put simply, this tax discriminates against people who transact in digital assets. This tax is universally applied, regardless of whether the investor realizes any gain, or whether ownership is even being transferred. This expansive provision would affect any tech transaction, including potentially AI and cloud-based applications.

“Today we are asking the courts to protect consumers and our members and stop this unfair tax in Illinois. Taxes should be carefully considered, not only for the revenue they produce but for the fairness of those being taxed. That was not the case here, as the provision slipped into legislation the night before the bill’s final consideration,” said Cody Carbone, TDC’s CEO.

From here, the court’s rules provide a window for more groups to join this lawsuit. To inquire about joining this fight, contact policy@digitalchamber.org to learn more.