The United States has confirmed that a new $100,000 fee for H-1B visas will apply only to new applications, not to existing holders or renewals.
The clarification, announced by the White House after President Donald Trump imposed the charge from Sunday, has brought relief to India’s $283 billion IT sector.
The industry had raised concerns about the impact of the fee on business continuity, given that more than half of its revenue is tied to the US market.
India’s top tech lobby Nasscom said the update helps reduce uncertainty and allows companies time to prepare.
White House clarification on H-1B fee
The new $100,000 H-1B visa fee applies only to fresh applications filed from the next cycle in 2026. The White House confirmed that existing visa holders and those applying for renewals will not be impacted.
It also clarified that the charge is a one-time payment, not an annual levy. This detail addressed earlier confusion about whether the fee would repeat each year and affect business operations.
The announcement narrowed the scope of who will pay the fee, focusing entirely on new applicants.
Impact on Indian IT industry
Nasscom, India’s software industry body, welcomed the clarification. The organisation said the decision reduces uncertainty for companies with existing visa workers in the US.
Nasscom noted that Indian and India-centric companies have already reduced their reliance on H-1B visas. The industry has increased local hiring and invested heavily in training staff in the US.
Nasscom estimated that IT companies are spending over $1 billion on upskilling and recruitment in the American market.
It also pointed out that the share of H-1B workers in the US labour force remains very small, calling it a “mere decimal point”.
Revenue dependence on US clients
Indian IT companies derive about 57% of their total revenue from the US. Many of these firms send employees onshore to work directly on client projects.
Analysts and legal experts noted that even a one-time fee of $100,000 is substantial for new visa applications.
While the industry has reduced its dependence on the programme, the cost could still be prohibitive for smaller firms or for projects requiring large numbers of new hires.
The timing, however, allows companies several years to adjust by expanding local recruitment and training before the rule comes into effect in 2026.
Preparing for changes in 2026
The H-1B fee policy is expected to reshape hiring strategies. Nasscom said the extra time before the fee takes effect gives companies space to expand operations in the US and step up workforce development.
Indian IT exporters have already made progress in this direction, with a marked increase in local hires across American offices.
The focus on localisation is expected to deepen further as companies aim to offset the higher costs of future visa applications.
While the fee introduces an additional expense for fresh hires, its limited scope provides the sector with a buffer to adapt.
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