President Donald Trump’s plans for H-1B visas run into legal obstacles.

A federal appeals court on Friday refused to revive Trump’s $100,000 fee on new H-1B work visas, dealing another setback to the administration’s effort to sharply increase the cost of hiring highly skilled foreign workers.

The Boston-based 1st U.S. Circuit Court of Appeals refused to stay a lower court ruling that blocked the fee while the administration appealed. A three-judge panel said the government did not show it was likely to succeed in arguing that the president had the authority to impose the charge.

The decision leaves in place a June ruling by U.S. District Judge Leo Sorokin, who said the fee amounted to a tax, authorized by Congress, not the president.

“Here, the substance and application of the $100,000 payment reveals that it is a tax, regardless of what the payment is called,” Sorokin wrote.

Trump announced the tariff in September 2025 as part of a broader immigration crackdown, claiming at the time that the H-1B program “has been deliberately exploited to replace, rather than supplement, American workers with lower-paid, lower-skilled labor.”

Brian Hunt, an immigration policy compliance attorney at Fragomen, Del Rey, Bernsen & Loewy, LLP, told Business Insider that it’s unclear how many people this court decision will affect, because most American employers hire H-1B workers who are already in the United States.

“In light of the 100,000 fee, there are some workers who were about to lose their job offer but can now get a visa after all,” Hunt said.

The H-1B program issues about 65,000 visas each year, plus another 20,000 for workers with advanced degrees, and is widely used by technology companies to recruit foreign talent. Before Trump’s policy, employers typically paid between $2,000 and $5,000 in visa-related fees.

Court documents show the sharp increase has sharply reduced demand. As of mid-February, U.S. Citizenship and Immigration Services had received few payments of the new fee.

The lawsuit challenging the fee was filed by 20 Democratic state attorneys general.

The White House did not immediately respond to a request for comment.