On September 19, 2025, President Donald Trump announced a staggering $100,000 annual fee for H-1B visa applications, sending shockwaves through the tech industry and immigrant communities, particularly among Indian professionals who make up a significant portion of H-1B visa holders.
The stated goal was to protect American jobs by making the program less economically viable for companies hiring lower-wage foreign workers, aligning with Mr. Trump’s ‘America First’ agenda.
US Commerce Secretary Howard Lutnick, who stood next, described the move as an annual charge applicable to both new applicants and renewals. The announcement suggested the fee would take effect almost immediately, by September 21, 2025.
Announcement sparks panic
The announcement, exacerbated by Mr. Lutnick’s incorrect claim of an annual fee, sparked widespread panic among H-1B workers, some of whom rushed to re-enter the US, fearing exclusion.
Companies, immigration lawyers, and H-1B workers scrambled to interpret the policy, with some firms, including JPMorgan, reportedly advising employees abroad to return to the US before the September 21 deadline to avoid the fee.
The new policy takes a U-turn
However, within 48 hours, the White House issued a clarification, stating that the fee would be a one-time charge applicable only to new applicants, not renewals or existing visa holders.
The administration also confirmed that existing visa holders could travel in and out of the US without facing the new fee, directly contradicting earlier fears that the policy would apply retroactively.
This reversal was formalized in a US Citizenship and Immigration Services (USCIS) FAQ, which emphasized that the fee would apply only to new applications in the next lottery cycle, expected around March 2026.
The White House also hinted at potential exemptions for roles deemed in the ‘national interest,’ though the criteria for such waivers remain undefined.
So, why the U-turn?
The rapid reversal of the H-1B fee policy can be attributed to a combination of practical, economic, diplomatic, and political pressures.
The initial announcement blindsided major tech companies, which rely heavily on H-1B workers to fill specialized roles. In 2024, over 65% of H-1B visa holders were employed in IT, with companies like Tesla, Google, and Amazon among the top sponsors. An annual $100,000 fee per visa holder would have imposed crippling costs, potentially billions annually for large firms. For example, Indian IT giants like Tata Consultancy Services and Infosys, which sponsor thousands of H-1B workers, faced estimated cost increases of $150–550 million.
The US Chamber of Commerce voiced concerns about the policy’s impact on employees, families, and employers, signaling potential economic disruption. The tech industry’s swift backlash, coupled with warnings from immigration lawyers about legal challenges, may have pressured the administration to scale back the fee’s scope to avoid alienating a key economic sector.
India, whose nationals account for approximately 70% of H-1B visa holders, reacted to the announcement by urging the US policy-makers to look at the contributions of skilled talent towards innovation in technology and economic growth. Indian officials also highlighted the possible humanitarian consequences for those affected.
Immigration experts, including former USCIS official Doug Rand, labeled the original proclamation ‘lawless,’ arguing that Congress, not the executive branch, has authority over visa fee structures.
What is the H-1B visa that sparked a major debate?
The H-1B visa program, established in 1990, allows US employers to hire foreign workers in specialty occupations like technology, engineering, and medicine, with an annual cap of 85,000 visas (65,000 standard and 20,000 for advanced-degree holders).
But the program has long been a lightning rod for debate.
Critics argued that it undercuts American workers by allowing companies to hire foreign talent at lower wages, while supporters, including tech giants like Google, Amazon, and Tesla, emphasized its role in filling critical skill gaps.