The US Citizenship and Immigration Services (USCIS) issued a significant update on October 20, 2025, exempting foreign workers already in the US on visas like F-1 (student) or L-1 (intracompany transfer) from the new $100,000 H-1B visa fee. As per reports, the new update allows these individuals to apply to switch to H-1B status internally and re-enter the US without penalty, a loophole that has ignited controversy.
.@USCIS has issued updated guidance on the H-1B Procolomation on their website (https://t.co/dPCGt5ZPhj) pic.twitter.com/L1Fmn1d92I
— Steven Brown (@AttyStevenBrown) October 20, 2025
The new update has come after Donald Trump’s September 19, 2025, proclamation, which imposed the hefty fee on new H-1B petitions as part of his “Project Firewall” to prioritise American jobs and curb outsourcing, particularly targeting tech industries reliant on Indian and Chinese talent.
After initial claims that this is basically a kill shot on the H1B visa program, that sees most Indians and Chinese talents coming to US for high skilled work.
USCIS confirms that the $100,000 H-1B fee can be avoided if the applicant enters on a different visa (e.g. F-1 visa for international students, L-1 visa for international companies) and then switches to H-1B inside the US. They can re-enter the US on their H-1B and not be fined. https://t.co/XsTou74Sl3
— Sam Peak (@SpeakSamuel) October 20, 2025
Initially hailed as a strict crackdown, the announcement sent shockwaves through the tech sector, with companies like Microsoft and Amazon urging H-1B holders to stay in the US.
There were even reports of many Indians cancelling their trips home, as they were worried about re-entry in the US.
Soon, the White House had clarified that the Trump order of $100,000 H-1B visa fee was only for new applications and is not applicable for existing H1B holders.
The new USCIS clarification, however, reveals the fee applies only to new ‘external applicants’, preserving over 85,000 annual H-1B approvals. Students and professionals already in the US on a different visa are exempt by the $100,000 fee, a substantial amount in most countries.
It is notable here that the H1B visa is seen as a ‘threat’ by the MAGA voter base, who claim the Indians and Chinese are ‘stealing’ the jobs of Americans. However, many tech bosses, most importantly Elon Musk, have been vocally supportive of the H1B Visa program, highlighting that it is crucial to get global tech talent to USA. Musk had even declared that he is ready to ‘go to war’ on the issue.
