New US Visa Fee Rules Set to Raise Costs for Major IT and Consulting Firms

The United States has issued new rules under which large employers will have to pay an additional fee when extending the H-1B and L-1 visas of their employees. Under the new provisions, employers will be required to pay $4,000 for an H-1B visa extension and $4,500 for an L-1 visa extension. Previously, the fee was applicable only when new applications were filed or when employees changed jobs. The new rules will now bring certain visa extension applications within the scope of the fee. Several major Indian IT and consulting companies operate under this employment-based visa model, making them among the businesses that could be affected by the new provisions. New Fee to Take Effect From September 9 According to the US Department of Homeland Security (DHS), the ‘9-11 Response and Biometric Entry-Exit Fee’ will come into effect from September 9. The rule will apply to companies that have 50 or more employees in the United States, with more than 50% of their workforce holding H-1B or L-1 visas. The change is expected to significantly increase expenses for technology companies, global consulting firms and IT services providers covered by the rule. Higher Costs for Visa Extensions Under the new provisions, companies seeking to extend the visas of existing employees will have to pay the additional fee, which was not previously required for such extensions. However, the department has clarified that applications which do not seek an extension of visa validity will be exempt from the increased fee. Government Estimates $157.3 Million in Annual Revenue The US government estimates that the new rule will generate approximately $157.3 million in revenue each year. The funds collected will be used to support the biometric systems of US Customs and Border Protection. Congress introduced the fee in 2015 as part of efforts to strengthen national security. For IT companies that employ thousands of Indian engineers, the new requirement could translate into an additional financial burden running into crores of rupees every year.