H-1B $100,000 Fee: What It Has Done to Indian IT Companies and Workers

The United States introduced a $100,000 fee on certain new H-1B visa petitions in 2025, a measure that fell hardest on India. Indian nationals have long been the largest group of H-1B holders, and IT services companies such as TCS, Infosys and HCL built part of their business on sending engineers to the United States. Reports say Indian IT majors cut their H-1B registrations by 92 percent after the fee, about 9,000 percent above the previous average cost of $1,000 to $1,500 per application. The median H-1B salary at such firms is roughly $80,000 to $120,000, so the fee equals or exceeds a year’s pay.

Analysts have estimated the financial effect. Jefferies calculated that the fee could erode operating margins by 50 to 150 basis points for each H-1B employee, according to reports, and large firms such as Infosys and TCS earn more than 55 percent of their revenue in the United States. Companies have responded by hiring more people locally in the United States and by moving more work to offshore delivery centres in India. Local hiring is much more expensive than the old model, so firms face higher costs either way, which is a heavy burden for any company.

On 8 June 2026, the US District Court for the District of Massachusetts struck down the fee, ruling that the proclamation was not an immigration restriction but a tax that the president had no authority to impose. The administration appealed on 11 June. An administrative stay kept the fee in place for a period, and on 24 July 2026 the First Circuit Court of Appeals denied the government’s motion to stay the judgment. Law firms said USCIS was then no longer permitted to charge the fee while the appeal continues, and Indian IT stocks rose on the news, as investors saw relief for the sector.

The picture is not settled. Reports in September 2026 said the US government was extending the surcharge for a further year, while law firm updates described the fee as blocked again in August, so employers are working with conflicting signals. Another report said agencies were told to cross-check H-1B applications against domestic layoff data, which increases scrutiny of employers that have recently cut US staff. Companies should check the latest court orders and USCIS guidance before relying on any single summary, because the legal position has changed several times in only a few months.

For India, the broader question is how far its technology exports depend on one country’s visa policy. The US administration’s stated aim is to protect American jobs, and its layoff-data checks point in the same direction, while Indian firms say they also employ many Americans. Whatever the courts finally decide, the episode has pushed Indian companies to diversify their markets, hire more locally in the United States and build more delivery capacity at home, a shift that may well outlast the dispute itself and change the industry’s business model for years, a point Indian analysts often make.

Featured image: The glass pyramid at the Infosys campus in Bengaluru (file photo, 2011). Photo by Vinu Thomas from Bangalore, India, licensed under CC BY-SA 2.0, via Wikimedia Commons.