A Massachusetts federal judge has barred the U.S. government from collecting a new $100,000 fee from employers hiring new workers under the H-1B visa program. The ruling is a defeat for President Donald Trump, who announced the fee in September of 2025. Trump claims the fee is necessary to curb abuse by employers who are using it to replace American workers with lower-paid foreign workers. The Trump administration indicated it plans to appeal the ruling.
Twenty states sued to stop the fee from being collected, and on June 8, U.S. District Judge Leo Sorokin found that the fee functioned as a tax that Congress had not authorized. He also found that the administration’s implementation of the fee violated the Administrative Procedure Act (APA). Sorokin explained that in the Immigration and Nationality Act of 1952 (INA), Congress gave the president the authority to regulate entry into the United States. But he found the INA did not clearly delegate to the president the power to impose new taxes.
The H-1B visa program allows employers to temporarily hire foreign workers in specialty occupations and as fashion models of distinguished merit when the employers can’t otherwise find employees with the necessary skills in the U.S. workforce. A specialty occupation is one that requires highly specialized knowledge and requires a bachelor’s degree or its equivalent. The U.S. technology industry relies heavily on the H-1B program, with many of the visas going to employees working for large U.S. employers like Microsoft, Amazon, Meta, and Google.
The 20 states that challenged the new fees for the H-1B visa program contended that they would also be harmed by the fee. They argued that the fee would exacerbate teacher shortages by hindering states’ ability to hire elementary and secondary school teachers and make it more difficult for them to staff public universities. Additionally, they claimed Trump’s $100,000 H-1B fee would harm healthcare by making staff shortages at medical facilities worse. The states noted that fees of between $960 to $7,595 were already being charged for H-1B visa applications before the new fee was added.
Sorokin’s reading of the INA appears to be at odds with a previous district court ruling in a case brought by the U.S. Chamber of Commerce. In December of 2025, a judge for the U.S. District Court for the District of Columbia upheld the president’s power to impose the fee after finding Congress had delegated that power to the president in the INA. However, that decision came before the U.S. Supreme Court found President Trump’s tariffs to be unconstitutional in February. Sorokin cited the Supreme Court’s tariff ruling in his decision, although the opinion mostly relied on the previous Supreme Court decision in National Federation of Independent Business v. Sebelius. In Sebelius, SCOTUS held that the Affordable Care Act’s requirement that taxpayers without health insurance pay a fee was a tax, not a penalty.
President Trump’s Proclamation
Proclamation 10973, Restriction on Entry of Certain Nonimmigrant Workers, starts by noting that the fee is necessary because the H-1B visa program has been used to replace American workers with low-cost foreign labor. It then points out that an increasing number of jobs with IT and tech companies are staffed by foreign workers. The proclamation does not address employment by states, nonprofits, or higher education.
The new $100,000 payment requirement was to take effect on Sept. 21, 2025. It would have expired in September 2026 if not extended. The proclamation only applied to nonimmigrants entering the country after the date it was signed. Employers were required to provide documentation that they had made the $100,000 payment prior to filing an H-1B visa petition.
Fee Qualifies as a Tax
The judge began his analysis of the case by looking at whether the fee was unlawful as an intrusion on Congress’s taxing power under the U.S. Constitution. While the government argued that the fee was a penalty rather than a tax, the judge concluded that it was not a penalty because it was not imposed to punish businesses seeking an H-1B visa.
The government also claimed that the fee could not be a tax because taxes are imposed to raise revenue and the president’s policy would have the effect of decreasing the number of H-1B visa requests. However, the judge found it was indisputable that each $100,000 payment to the government was revenue. He added that no legal authority suggests that payments to the government only qualify as a tax if they increase the total revenue collected from the tax.
Finally, the judge explained that a tax, such as a tobacco tax, may have the purpose of curbing an undesirable activity. Therefore, the fact that the fee was imposed to limit the use of H-1B visas does not prevent it from qualifying as a tax.
No Delegation of Taxing Power
The Constitution does not bar the executive branch from levying a tax if Congress has specifically delegated the authority to do so, the judge found. However, that delegation of authority must be clearly indicated in the relevant statute. While President Trump’s proclamation claims he was delegated the authority to impose the fee under the INA, the judge said it was not clear.
The government maintained the president had the authority to impose the fee under the provision in the INA allowing the president to “impose on the entry of aliens any restrictions he may deem to be appropriate.” The judge found that the INA granted the president broad powers, but none of its language delegates the power to tax to the president.
