Court strikes down H-1B fee: $100,000 is a tax

The constitutional reasoning is simple, and that is exactly why it convinces. The US Constitution gives the power to levy taxes and duties to Congress. In immigration law, the President has sweeping powers to suspend or restrict the entry of groups of foreigners. He has no power to demand payment for entry.

The government had argued that the payment was not a tax but a condition of the entry restriction. The court saw this as a workaround: if you demand a payment and grant permission in return, you are levying a charge, whatever you call the paper.

This decision contradicts a ruling by a court in Washington on December 23, 2025, which upheld the fee. Two federal courts, two opposite outcomes, one question.

For now, not much, and that is the uncomfortable truth for employers. The government has appealed and asked for a stay. Until the appeals courts rule, the legal situation remains unclear.

And for workforce planning, uncertainty costs more than a clear, harsh rule. A company filing a petition now doesn't know whether it has to pay, whether it will get back what it paid, or whether it will have to pay later.

If two appeals courts rule differently, the question goes to the Supreme Court. That takes a year, maybe longer.

You have to put the two stories side by side to see the direction. On June 9, 2026, the State Department issued an interim final rule introducing a new fee: $750 for an expedited B1/B2 visa appointment.

Pay the fee and you get an interview within ten business days at selected consulates and embassies. It is an optional add-on alongside the regular process. The rule takes effect on July 1.

For most Europeans this matters only indirectly, because visits and business trips usually run through the Visa Waiver Program. It becomes relevant for anyone who falls out of the program: because of past travel to certain countries, dual citizenship or a denied travel authorization.

And it matters for your business partners, employees and customers from countries without visa waiver. Anyone who has tried to bring a delegation from India, Brazil or Turkey to a trade show knows the wait times for appointments. From July, there's a price for skipping them.

Paying for priority at a government appointment is hard to imagine in much of Europe. In the United States it has been standard practice for years: expedited processing for a fee at the immigration agency, paid pre-screening programs at airports, and now the visa appointment too.

You can criticize that. But you should also see what it delivers: a predictable alternative to a process whose wait times nobody otherwise controls. For a company that needs a specialist in ten days, $750 isn't a hurdle, it's a solution.

It's a recurring pattern in this country: where capacity is scarce, a price emerges. If you come from a system that hands out scarcity through waiting lists, you'll find it indecent at first and practical later.

Don't build your workforce planning on the H-1B while the legal situation is up in the air. If you need to fill a position in the next twelve months, have a second route.

Document what you've paid. If the fee falls for good, the question of refunds will come up. Whoever has cleanly documented when they paid what, and under what reservation, will be in a better position.

And look at the alternatives this dispute doesn't touch at all. The L-1 for transferring staff to your own subsidiary has no lottery and no special levy. Neither does the E-2 for investors from treaty countries. Both are covered in L-1 visa and E-2 investor visa, with the comparison in L-1 vs. E-2.

Because it draws the same line the Supreme Court drew on tariffs in February. Back then it was an emergency statute that doesn't support tariffs. Now it's an immigration power that doesn't support levies.

In both cases the message is the same: there are tools for everything, but they have to go through the proper channel. If you want to raise money, you need a statute or a statutory authorization with a process.

For European companies, that is the real good news of the year. Not that a particular fee falls, but that there are limits and that courts enforce them, even against the sitting President, even on issues he cares about.

If you're moving your wealth and your business to another country, this is exactly what to look for. Not the politics of the day, but whether the limits actually work.

Take a developer position paying $120,000 a year. Without the special levy, the H-1B route costs a low five-figure sum in fees and attorney costs, spread over several months. With the levy, first-year costs double or triple.

Bringing the same person over as a transfer from a European parent company costs attorney fees and structure, but no special levy, no lottery and no waiting for a cap year.

That's why, in recent months, the question has answered itself for many mid-sized companies. Not because the L-1 is better, but because it's the only process whose costs you know in advance.

The catch: there has to be a European parent company in the first place, the person must have worked there for at least a year in a managerial role or with specialized knowledge, and the link between the companies must be provable. If you still have to build that, you need lead time.

Nine months of legal changes fit into one sentence: if you rely on executive actions, you build on sand. If you rely on statutes, you build on rock.

The September proclamation was struck down by a court. The emergency-statute tariffs were struck down by the Supreme Court. Both were fast tools, and that is exactly why neither held.

What has held, and keeps holding, are the routes built on statutes and treaties. The E-2 rests on treaties of commerce and friendship between the United States and its partner countries. The L-1 is written into immigration law. So is the EB-1.

These routes aren't the fastest or the cheapest. They are the only ones where you know what will apply three years from now.

And for anyone who has to make a decision this year: for every route, ask what legal basis it stands on. If the answer is a proclamation or an order, plan a fallback. If it's a statute or a treaty, you can rely on it.

If you're looking for a job in the United States as an individual and would depend on an H-1B, be realistic this summer: the route isn't closed, but it has become narrow and expensive, and American employers think twice before taking it.

What works are routes where you are the applicant yourself. If you bring or build your own business, you don't depend on someone else filing a petition for you and paying for it.

For many professionals from Europe, that is exactly this year's shift in perspective: coming not as an employee but as an entrepreneur who has customers instead of an employer.

What really changed for European entrepreneurs this spring isn't the size of a fee. It's the realization that the route through American employment has become unpredictable, and the route through your own business has not.

If you build a company, invest and transfer people, you stand on a legal foundation that has been in place for decades and that no proclamation can touch. That was always an advantage. This year it has become a decisive one.

An appeal, possibly two, and most likely the Supreme Court in the end. Alongside that, the possibility that the government pursues the same goal another way: through a proper regulation with a notice-and-comment process.

That second route would hold up far better legally, and it is the more likely outcome. A fee adopted through rulemaking stands a very different chance in court than a proclamation.

So if you're hoping this burden disappears for good, don't make that hope the basis of your planning. The direction is set; only the tool is being swapped.

If you want to put staffing for your American company on a solid footing, talk to Mount Bonnell Advisors in Austin, Texas. The big picture is covered in our US Visas and Green Cards section, the operational side in Sending Employees to the USA and Payroll and Payroll Accounting.

Update: What happened next is covered in One more year: the President extends the H-1B ban while a court blocks the $100,000 fee.

Consultation & implementation

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