A federal judge on Monday voided a $100,000 [1] fee for new H-1B visa petitions imposed by the Trump administration.

The ruling removes a significant financial barrier for companies seeking skilled foreign workers. By striking down the cost, the court prevents a massive increase in the expense of hiring high-skilled immigrants, which critics argued would stifle innovation and economic growth.

U.S. District Judge Leo Sorokin issued the decision in the U.S. District Court for the Southern District of New York. Sorokin ruled in favor of a coalition of 20 [1] Democratic-led states that challenged the legality of the payment. The judge said the fee was unlawful, stating it violated federal law and imposed an undue financial burden on employers.

"The fee is an unconstitutional tax," Sorokin said [3].

The coalition of states argued that the administration exceeded its authority by implementing the charge. They contended that the payment functioned as a tax rather than a processing fee, thereby bypassing the legislative process required for new taxes.

New York Attorney General Letitia James (D-NY) highlighted the impact of the court's decision on the labor market. "We are protecting American jobs and ensuring that the H-1B program remains fair and affordable," James said [2].

The H-1B program allows U.S. employers to temporarily employ foreign workers in specialty occupations. The voided fee of $100,000 [1] per petition would have applied to new applicants, creating a steep entry cost for both small businesses and large corporations. The court found that the administration's move was an illegal attempt to raise revenue under the guise of visa processing.

“"The fee is an unconstitutional tax."”

This ruling reinforces the legal boundary between administrative fees and taxes, asserting that the executive branch cannot unilaterally impose high costs on visa petitioners without congressional approval. By blocking the fee, the court ensures that the H-1B visa process remains accessible to a broader range of employers, preventing the program from becoming a luxury available only to the wealthiest corporations.