The U.S. technology industry is bracing for a major disruption after President Donald Trump signed a proclamation that imposes a crippling $100,000 annual fee on H-1B visas. This unprecedented move targets the primary vehicle through which companies hire high-skilled foreign workers, a practice that has been fundamental to the growth of Silicon Valley and the broader tech ecosystem. The fee is set to affect tens of thousands of workers, predominantly from India and China.
The administration has presented the policy as a necessary measure to prioritize American workers. “Stop bringing in people to take our jobs,” stated Commerce Secretary Howard Lutnick during a press conference. He claimed to have briefed “all the big companies” on the fee, framing it as a choice: either pay a premium for exceptionally valuable foreign talent or hire and train an American graduate.
This new cost structure threatens to upend the business models of many tech firms, from established giants to fledgling startups. In the first half of 2025, Amazon alone had over 10,000 H-1B visas approved. For smaller companies and startups, a $100,000 annual fee per foreign employee could be an insurmountable barrier, potentially stifling innovation and growth before it even begins.
The proclamation has drawn sharp condemnation from venture capitalists and tech leaders. Deedy Das of Menlo Ventures argued on social media that this move “drastically reduces [the US’s] ability to innovate and grow the economy.” The debate highlights a deep divide: one side sees the H-1B program as a tool for wage suppression, while the other views it as essential for maintaining America’s status as a global technology leader.
Furthermore, the legality of the executive action is in serious doubt. Experts in immigration law, such as Aaron Reichlin-Melnick from the American Immigration Council, have been quick to point out that the president has “zero legal authority” to impose such a fee. The existing legal framework allows for fees to cover processing costs, not to act as a punitive or deterrent measure, setting the stage for a protracted legal fight over executive power.