Eighteen cryptocurrency businesses and organizations asked an Illinois court on Thursday to strike down the state's pending 0.2% tax on digital asset transactions, filing an amicus brief that calls the levy discriminatory, unconstitutionally vague and, as written, practically impossible to enforce.

The submission takes the form of an amicus curiae — a "friend of the court" filing through which parties not directly involved in a case may present legal arguments or subject-matter expertise for the court's consideration. The eighteen signatories, a group of crypto companies and industry organizations, used this vehicle to ask the court to invalidate the transaction-based levy.

At issue is a proposed 0.2% tax applied to transactions involving digital assets. Unlike taxes assessed on income or holdings, a transaction-based levy is triggered each time a digital asset changes hands, which puts how such transactions are defined, measured and collected at the center of the dispute. The objections set out in the brief are threefold: the measure is discriminatory; its drafting is unconstitutionally vague; and, as written, it would be practically impossible to enforce.

Amicus briefs are a long-standing feature of litigation in the United States, allowing companies, trade groups and other outside parties to weigh in on legal questions without joining a case as plaintiffs or defendants. U.S. states have taken differing approaches to the taxation of digital assets in recent years, and industry participants have repeatedly gone to court to challenge state-level measures they consider unlawful — a pattern this filing now extends to Illinois' pending levy. The immediate question before the court is whether the 0.2% levy can take effect as drafted or should be invalidated on the grounds the signatories have laid out.

This content was first published on COINOTAG.