A US federal appeals court has rejected the Trump administration's request to reinstate a $100,000 fee on new H-1B visas, dealing a setback to its effort to discourage employers from hiring foreign workers over Americans.
The Boston-based 1st US Circuit Court of Appeals declined to stay a June 8 ruling by US District Judge Leo Sorokin, who found that the fee amounted to an unlawful tax that Congress had not authorised.
The lawsuit challenging the policy was filed by 20 Democratic-led states.
Judge Sorokin ruled that the executive branch had exceeded its authority and violated the Administrative Procedure Act. "The Court finds that the Policy imposes a tax on H-1B petitions without the requisite delegation by Congress," he wrote.
The Trump administration announced the fee increase in September 2025, arguing that the H-1B programme had been used to replace American workers with lower-paid foreign labour. Before the proposed increase, employers sponsoring H-1B workers generally paid between $2,000 and $5,000 in government filing fees, depending on the application.
The $100,000 fee would not have applied to foreign nationals already in the United States on student visas, who account for a significant share of new H-1B recipients. Court filings showed the policy sharply reduced demand for new H-1B petitions, with the US Citizenship and Immigration Services receiving very few payments under the new fee structure by mid-February.
The H-1B programme provides 65,000 visas annually for highly skilled foreign workers, with an additional 20,000 visas reserved for applicants holding advanced US degrees. Successful applicants are generally granted visas valid for three to six years.
Massachusetts Attorney General Andrea Joy Campbell welcomed the appeals court's decision, saying it protects employers that depend on highly skilled foreign workers in sectors such as education, healthcare and medical research. She said the ruling would help the state fill critical vacancies and continue recruiting faculty members and researchers.