In a landmark shift to U.S. immigration policy, President Donald Trump has signed an executive order implementing a $100,000 annual fee for each H-1B visa application, sparking widespread debate across the technology and business communities.

Effective September 21, 2025, this new mandate aims to reduce the perceived exploitation of the H-1B program and encourage employers to focus on hiring American professionals. The rule targets companies filing petitions for workers currently outside the United States and will initially be valid for 12 months, with potential for extension after a federal review.

Policy Goals and Government Rationale

According to the Trump administration, the objective is not to eliminate the program but to ensure that it serves its original purpose — attracting top-tier global talent without displacing U.S. workers. The proclamation directs agencies to revise wage structures and prioritize high-income, highly skilled roles.

White House staff secretary Will Scharf stated, “What this proclamation will do is raise the fee that companies pay to sponsor H-1B applicants to $100,000. This will ensure that the people they’re bringing in are actually very highly skilled and that they’re not replaceable by American workers.”

Similarly, Commerce Secretary Howard Lutnick defended the steep cost, asserting, “So no longer will you put trainees on an H-1B visa. That it’s just not economic anymore. If you’re going to train people, you’re going to train Americans… If you have a very sophisticated engineer and you want to bring them in… then you can pay $100,000 a year for your H-1B visa.”

Major Impact on U.S. Tech Firms and Indian Professionals

The tech sector is expected to be significantly affected, given its long-standing reliance on H-1B workers. Companies such as Amazon, Microsoft, and Meta collectively received tens of thousands of H-1B approvals in just the first half of 2025.

India remains the dominant source of H-1B talent, comprising 71% of visa beneficiaries last year, followed by China at just under 12%, according to official government data.

For Indian professionals, this change introduces new barriers, especially as many must renew visas multiple times due to the backlog in green card processing. The revised policy could result in repeated six-figure payments during the visa’s multi-year term.

Concerns from Industry and Immigration Experts

The fee hike has prompted a wave of criticism from venture capitalists, tech investors, and immigration analysts, many of whom fear the U.S. could lose its competitive edge in innovation.

Deedy Das, partner at Menlo Ventures, warned on X: “Adding new fees creates disincentive to attract the world’s smartest talent to the US. If the U.S. ceases to attract the best talent, it drastically reduces its ability to innovate and grow the economy.”

Jeremy Goldman, an analyst at eMarketer, offered a similar outlook: “In the short term, Washington may collect a windfall; in the long term, the US risks taxing away its innovation edge, trading dynamism for short-sighted protectionism.”

Regulatory Details and Enforcement Measures

The U.S. government has clarified that visa petitions will not be approved unless employers provide proof of the $100,000 payment. The Secretary of State will verify this during the consular process. Employers must retain documentation as evidence of compliance.

Companies are also barred from using B visas as a workaround while waiting for H-1B start dates, particularly for employment starting before October 1, 2026. Meanwhile, IT outsourcing firms, which are historically heavy users of H-1B visas, will undergo increased scrutiny.

The Department of Labor is expected to adjust prevailing wage standards upward, while the Department of Homeland Security will modify selection criteria to favor higher-paid applicants.

Legal Questions and Political Backdrop

Some immigration attorneys have questioned whether the new fee complies with U.S. law. Aaron Reichlin-Melnick from the American Immigration Council stated, “Congress has only authorised the government to set fees to recover the cost of adjudicating an application,” raising concerns that the move could face legal challenges.

This visa policy is part of a broader crackdown by President Trump’s administration targeting both unauthorised immigration and restructuring legal channels. He described the policy as a method to ensure the U.S. only admits the “best of the best.”

“We need workers. We need great workers, and this pretty much ensures that that’s what’s going to happen,” Trump said while signing the order in the Oval Office.

Introduction of the ‘Gold Card’ Visa

In a parallel announcement, Trump introduced a ‘Gold Card’ visa initiative, granting permanent residency to individuals willing to invest $1 million personally or $2 million as a business to fast-track visa sponsorship.

Howard Lutnick, describing the current employment-based green card process as flawed, remarked: “Historically, the employment-based green card program led in 2,81,000 people a year. And those people, on average, earned $66,000 a year, and they were five times more likely to go on government assistance programs. So we were taking in the bottom quartile, below the average American. It was illogical.”

The new program, Lutnick said, will prioritise “extraordinary people at the very top” who can create jobs and stimulate the economy.

What Comes Next

The $100,000 fee rule is expected to be reviewed within 30 days of the next H-1B lottery. Based on agency recommendations, President Trump may decide whether to extend or revise the measure.

As the U.S. heads into a crucial period of immigration reform, the outcome of this executive order could determine how competitive the country remains in attracting global talent — or whether high fees will drive innovation elsewhere.