Trump extends push for $100,000 H-1B visas by another year
A U.S. proclamation imposing a $100,000 fee on new H-1B visa petitions, announced in September 2025, remains blocked in court and the underlying legal challenge has now been extended by another year.
A federal district court judge ruled in June 2026 that the fee was unlawful, holding that it effectively amounted to a tax that only the U.S. Congress, not the executive, has the constitutional authority to impose.
The Boston-based U.S. Court of Appeals for the First Circuit declined to stay that ruling, meaning the $100,000 fee remains unenforceable while the appeal proceeds.
The lawsuit was originally brought by a coalition of U.S. state attorneys general challenging the proclamation.
Prior to the proclamation, standard H-1B-related government fees ranged from about $2,000 to $5,000 per application; the new fee would apply to new petitions, not renewals.
The H-1B Visa Programme and India's Exposure
The H-1B is a U.S. non-immigrant work visa category for "specialty occupations" requiring theoretical or technical expertise, commonly used by the technology, engineering, and healthcare sectors to hire foreign skilled workers, typically for three years and renewable up to six.
Key Details
- Statutory annual cap: 65,000 visas under the regular cap, plus an additional 20,000 for holders of advanced degrees from U.S. institutions (a total base cap of 85,000 new visas/year).
- When registrations exceed the cap, U.S. Citizenship and Immigration Services (USCIS) conducts a random lottery among registrants; the lottery does not reserve or restrict slots by nationality.
- Indian nationals account for roughly 70% of all H-1B beneficiaries in recent years, reflecting the scale of India's IT and engineering services workforce being sponsored by U.S. employers, not a country-specific quota.
- The visa is governed by the U.S. Immigration and Nationality Act (INA); the specialty-occupation category was created under the Immigration Act of 1990.
Because Indian nationals form the large majority of H-1B holders, any steep fee hike disproportionately affects Indian professionals and the Indian IT/services companies that rely on H-1B mobility to service U.S. clients, making the litigation's outcome directly consequential for India's services-export sector.
U.S. Separation of Powers: Executive Fee vs. Congressional Taxation Power
Under the U.S. Constitution, the power to levy taxes is vested in Congress, not the President, a foundational separation-of-powers principle. Courts reviewing the $100,000 H-1B fee proclamation held that a mandatory, revenue-raising charge imposed by executive proclamation, unconnected to any service rendered, functions as a tax and therefore exceeds executive authority absent explicit congressional delegation.
Key Details
- The district court's June 2026 ruling found the fee "unlawful" on these separation-of-powers grounds, rather than on immigration-policy grounds.
- The First Circuit Court of Appeals (Boston) declined to stay/lift the district court's block while the government's appeal proceeds, keeping the fee unenforceable.
- Litigation was brought by a coalition of Democratic-led state attorneys general as plaintiffs; the case remains before the appellate court with the merits not yet finally decided.
The extension of the legal fight by another year means the $100,000 fee remains suspended for now, but the case's eventual outcome will determine whether such a fee mechanism can be reintroduced by executive action or would require congressional legislation.
India-U.S. Services Trade and GATS Mode 4
Cross-border movement of skilled professionals, such as H-1B visa holders, corresponds to "Mode 4" (movement of natural persons) under the WTO's General Agreement on Trade in Services (GATS), one of the least liberalised modes of services trade globally due to the primacy of national immigration law over trade commitments.
Key Details
- GATS (1995, under the WTO) identifies four modes of services trade: cross-border supply, consumption abroad, commercial presence, and movement of natural persons (Mode 4).
- India has long sought greater liberalisation of Mode 4 access in trade negotiations, given its large IT/ITES services-export base, but WTO members retain sovereign control over immigration and visa policy, which limits binding Mode 4 commitments.
- The Indian IT services industry (a major contributor to India's software/services exports) relies heavily on short-term visas like the H-1B for onsite project delivery to U.S. clients.
A steep, sustained fee hike on H-1B visas would function as a de facto barrier to Mode 4 services trade with the U.S., a recurring friction point in India-U.S. economic engagement even though visa policy itself is not typically negotiated within trade agreements.
- The U.S. H-1B annual cap is 65,000 regular-cap visas plus 20,000 for U.S. advanced-degree holders (85,000 total new visas/year).
- Indian nationals receive approximately 70% of all H-1B visas issued.
- A U.S. district court ruled in June 2026 that the $100,000 H-1B fee was an unlawful tax; the Boston-based First Circuit Court of Appeals has kept that ruling in place pending appeal.
- Standard H-1B-related fees before the proclamation ranged from roughly $2,000 to $5,000 per petition.