Attorney General Bonta Secures Final Judgment in Lawsuit Challenging Trump Administration’s Unlawful $100K Tax for H-1B Visas

OAKLAND — California Attorney General Rob Bonta today celebrated a final ruling from the U.S. District Court for the District of Massachusetts finding unlawful and vacating the Trump Administration’s policy imposing a $100,000 tax payment on new H-1B visa petitions. H-1B visas allow U.S. employers to hire highly skilled foreign national workers in roles that require specialized skills, including as teachers, physicians, researchers, nurses, and other vital workers, to alleviate nationwide labor shortages. The tax has created a costly barrier for employers, weakened the economy, and disrupted essential services, especially for public sector and government employers trying to fill these positions. Attorney General Bonta led a multistate coalition in challenging the policy in December 2025. 

“The judgment is in! The Trump Administration’s unlawful and costly $100,000 tax has been struck down. This tax was an attack on America’s ability to attract and retain the high-skilled talent that strengthens our economy and helps us meet critical workforce needs,” said Attorney General Bonta. “California remains open for business, open to talent, and committed to ensuring our communities have essential services — from healthcare to education — that depend on a strong, skilled workforce.”

BACKGROUND

The H-1B visa program allows employers to petition for high-skilled foreign workers to temporarily fill positions in specialty occupations that require at least a bachelor’s degree. In petitioning for an H-1B worker, the employer must submit an application, certified by the U.S. Department of Labor, that employment of the H-1B worker will not negatively affect the wages and working conditions of similarly employed U.S. workers. Congress limits the number of H-1B visas available each year for most private employers, with the current cap set at 65,000, with an exemption of 20,000 for individuals with a master’s degree or higher. Many government and non-profit research organizations are exempt from the 65,000-person annual cap to ensure that the organizations are fulfilling their public service missions. 

Since its inception, the H-1B visa program has been continually tailored by Congress to carry out its purpose of meeting employers’ labor needs, while protecting the interests of American workers to ensure that they are not wrongfully displaced. Congress has repeatedly enhanced enforcement, increased penalties, and legislated on fees for H-1B petitions to prevent misuse of the program. Given its careful structure, the H-1B program has proven to be massively beneficial to the United States. The program has been especially important to state and local governments facing worker shortages in critical fields like education and healthcare, which have turned to H-1B visas in order to provide for the basic needs of residents. H-1B workers and their dependents contribute $86 billion annually to the economy and pay $35 billion in federal and payroll taxes, on top of $11 billion in state and local taxes.  

On September 19, 2025, President Trump issued a proclamation ordering an unprecedented $100,000 tax payment for new H-1B visa petitions, undermining the very purpose of the H-1B visa by making it harder to address severe labor shortages in critical fields such as education and healthcare and ultimately worsening the staffing crisis. As implemented by DHS through a series of written documents, the policy affected any application filed after September 21, 2025, and granted the Secretary of Homeland Security broad discretion to determine which petitions are subject to the fee or for an exemption, raising concerns that the enforcement could be applied selectively against employers disfavored by the Trump Administration. The $100,000 visa tax was devastating for all states, including California, and threatened the quality of education, healthcare, and other core services available to our residents.