A $103,265 line item: DHS moves cap-subject H-1B hiring onto the headcount budget

A cap-subject petition used to cost between $2,000 and $5,000 in fees ^[3]. The proposed charge is roughly 21 to 52 times that ^[1], it is per petition, and it sits on top of the fees employers already pay ^[2]. Five cap-subject hires in one cycle come to $516,325 ^[2]. That is a sum approved by whoever approves headcount, which is what actually changes behaviour: the cost leaves immigration counsel's budget and enters the same conversation as two more engineers.

The exemptions shape hiring more than the price does. Cap-exempt petitions, largely university and nonprofit or government research posts, are untouched ^[5]. So are renewals, and so is anyone already in the United States on a student visa, a group the proposal itself calls a large share of new H-1B recipients ^[6]. The cheapest lawful hire is therefore someone already studying in the country, or a role at an institution that never entered the lottery. Sponsoring a candidate who is abroad becomes the expensive path.

That is also where the revenue case wobbles. DHS splits the proceeds across six agencies, with US Citizenship and Immigration Services taking about $3bn and the immigration courts about $2.96bn ^[10]; the six allocations sum to roughly $8.78bn ^[4], which is what 85,000 petitions at the full fee would yield ^[3]. It yields that only if every cap slot pays. The carve-out for student-visa holders already in the country ^[6] takes a share of the base out of the calculation, and the notice does not say how much.

The earlier version of this fee is the reason the comment period matters more than the courtroom does right now. Trump imposed a $100,000 charge by order last year, invoking his authority to restrict the entry of foreign nationals ^[7]; a federal judge ruled it unlawful in June and stopped collection, and a Boston appeals court is reviewing that decision ^[8]. About 70 employers had paid across 85 applications by late February ^[12], roughly $8.5m ^[5], or about a tenth of one percent of what the new rule projects ^[6]. Collections were never the mechanism. DHS says the new fee rests on different legal authority ^[9]; the US Chamber of Commerce, Democratic-led states and a coalition of unions and employers argue the department cannot impose fees to raise revenue without Congress ^{[14] [15]}; the administration answers that the fee is not a traditional tax and that courts have little room to question presidential authority over entry ^[16]. None of that resolves before the rule can be finalised, which Reuters reports could happen by the end of the year ^[4]. The stretch between the 25 August Federal Register notice ^[4] and that finalisation is the only place an employer gets to put its own numbers on the record.

They would be arguing into a market that is already contracting. Registrations ran about 344,000 last year, down more than a quarter from 2024 and under half the 794,000 of 2023 ^[13], which is still roughly four registrations per available slot ^[7]. The fee is also not arriving on its own. DHS added charges of up to $4,500 to extension applications and to moving an employee in from abroad earlier this month ^[17], and has proposed weighting the lottery toward higher-paid workers while scrapping the grace period that lets laid-off H-1B holders look for work ^[18].