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Congress doubles H-1B fee to $4,000

Congressional leaders early Wednesday morning released a $1.1 trillion spending bill that dramatically hikes the H-1B filing fee for IT services that rely heavily on visa workers.

Congress must still vote to approve the spending bill. The final vote may happen Friday.

That new $4,000 fee is applied to firms of at least 50 employees and that have at least 50% of their employees on an H-1B or L-1 visa. It doubles a previous fee of $2,000, first set in 2010.

The increased fee will be used to help create a biometric entry and exit tracking system, according to the legislation.

The visa fee must be paid with the initial application and on any extension. The changes in the visa filing fees can be found beginning on page 1917 of the spending bill.

This increased fee will likely rile Indian IT services firms, which called the earlier fee discriminatory. These offshore IT services firms are the largest users of H-1B visa workers. Critics of the H-1B program may welcome the higher visa fee, but it's unlikely to impact their efforts to make the visa workers more expensive by hiking wages. NASSCOM, India's major IT industry group, said the $2,000 fee raised $70 to $80 million annually for the U.S.

The 2010 legislation was effective for five years and lapsed on Oct. 1, the start of the new federal fiscal year. The spending bill fee approved early today is good for 10 years, through Sept. 30, 2025. The initial $2,000 fee has had no apparent impact on the demand for visas, which has been rising.

Republican presidential contenders Donald Trump and, more recently, U.S. Sen. Ted Cruz (R-Texas) both want major changes in the H-1B program.

Cruz wants a minimum wage of $110,000 for H-1B workers, and Trump is offering a formula for increasing the prevailing wage scales. Among Democrats, Sen. Bernie Sanders (I-VT) is a critic of the visa.

Lawmakers, including Senators Charles Grassley (R-Iowa) and Dick Durbin (D-Ill.), want to prioritize H-1B distribution by wages, among other things, favoring firms that offer the highest salaries. Several reform bills, including one from Cruz and Sen. Bill Nelson (D-Fla.), are pending in the Senate.

The L-1 fee for companies with 50% of their workers on a visa is $4,500, according to the bill.

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