U.S. Foreign Labor Levy Legislative Proposal
The U.S. Foreign Labor Levy proposal establishes a 4-Pillar, 4-Tier Salary Framework targeting ~32.3 million documented non-citizen workers and students across all U.S. industries.
Its primary goal is to rebalance corporate incentives toward hiring U.S. citizens by removing the profit advantage of relying on foreign labor. The framework applies tiered levies that:
- Eliminate wage-based cost advantages for hiring non-citizen workers and students,
- Generate significant tax revenue to reinvest in U.S. workforce development, and
- Ensure fairness in low-wage sectors such as agriculture and hospitality.
The Work Visa & Employment Levy, Foreign Worker Payroll Levy, and Employee Remittance Levy operate within a 4-Tier Salary Structure (< $35K, $35K–$60K, $60K–$100K, > $100K). Rates for workers under $35K remain constant to protect industries where U.S. citizens are less likely to participate.
Additionally, the Offshoring Levy addresses remote foreign hiring. Undocumented workers (~5.7M, Pew 2024) are excluded due to untrackability. This assessment models the framework’s application across visas, green cards, humanitarian pathways, offshore employees, and international student enrollment.
It projects impacts on ~32 million documented workers and students between 2025 and 2028, estimating both the tax revenues generated and the number of jobs transitioned back to U.S. citizens, assuming only 40% of non-citizen labor and academia slots return to qualified U.S. citizens over the period (via a 50% overall reduction in foreign reliance, with 80% replacement by U.S. workers).
The results demonstrate the proposal’s potential to fund continuous workforce training and reduce long-term dependence on foreign labor.
Baseline: Current Usage and Costs
Volume: Approximately 32 million documented, working non-citizen workers and students annually, updated with verified data as of November 3, 2025:
Visas (~1.2M):
- H-1B: 214,000 (USCIS FY 2024–2025)
- H-2A (Agricultural): 133,000 (DOL 2024, FY 2023 adjusted for FY 2025)
- H-2B (Non-Agricultural): 84,000 (USCIS FY 2024–2025, including supplemental cap)
- TN (NAFTA): 21,000 (USCIS 2024)
- L-1/J-1: 43,000 (USCIS 2024)OPT (F-1): 107,000 (MPI 2025)
- Other Visas (O-1, P, etc.): 168,000 (adjusted to balance 1.2M total)
Green Cards (Legal Permanent Residents, LPRs, ~13M in Workforce):
- New Employment-Based (EB): 281,000 principals annually (USCIS FY 2024–2025)
- Active EB Holders: 1.12M from prior years
- Total LPRs: ~27M (DHS/OHS 2024–2025), ~48.1% labor participation, yielding 13M working LPRs
Humanitarian with Work Authorization (~3M):
- DACA: 796,000 (USCIS FY 2025 Q1)
- TPS: 1.26M (DHS 2024)
- Asylum Seekers: 936,000 (DHS 2024)
- Parolees: 281,000 (DHS 2024)
- Other Humanitarian: Adjusted to 3M total
Offshore Foreign Employees (~14M): 14,000,000
Foreign Student Enrollment with Work Options (~1.1M): 1,100,000 (F-1/OPT/CPT, MPI 2025)
Salary Distribution (BLS, Adjusted for Inflation):
- < $35K: 30% (9.69M workers, ~$30K average)
- $35K–$60K: 40% (12.92M workers, ~$52K average)
- $60K–$100K: 20% (6.46M workers, ~$80K average)
- $100K: 10% (3.23M workers, ~$120K average)
Overall Average Wage: ~$52K (weighted: agriculture ~$30K, professional ~$88K)
Profit Edge: Non-citizen workers save firms
- ~$11,000 per worker annually (wage gaps, tax breaks), totaling ~$355.3B industry-wide (32.3M × $11,000).
Impact of the Four Tax Pillars
1. Work Visa and Employment Levy
Structure (Per Worker, Tiered by Salary):
- < $35K: 3% (Years 1–3, constant). Cost: $900 ($30K × 3%)
- $35K–$60K: 7% (Year 1), 14% (Year 2), 20% (Year 3). Cost: $3,640–$10,400 ($52K)
- $60K–$100K: 10% (Year 1), 18% (Year 2), 28% (Year 3). Cost: $8,000–$22,400
- ($80K)$100K: 15% (Year 1), 25% (Year 2), 45% (Year 3). Cost: $18,000–$54,000 ($120K)
- H-1B/L-1 Surcharge: 5% (Years 1–2), 10% (Year 3) for below-median wages (~554,000 workers). Cost: $4,000–$12,000 (Year 3)
Affected Workers: All 32.3M documented workers.
Cost Impact: By Year 3, costs exceed savings, reducing usage by 40–60% (12.92M–19.38M fewer workers).
2. Foreign Worker Payroll Levy
Structure (On Wages, Tiered by Salary):
- < $35K: 7% (Years 1–3, constant). Cost: $2,100 ($30K × 7%)
- $35K–$60K: 12% (Year 1), 20% (Year 2), 30% (Year 3). Cost: $6,240–$15,600 ($52K)
- $60K–$100K: 18% (Year 1), 28% (Year 2), 40% (Year 3). Cost: $14,400–$32,000 ($80K)
- $100K: 25% (Year 1), 44% (Year 2), 55% (Year 3). Cost: $30,000–$66,000 ($120K)
- H-1B Surcharge: 10% (Years 1–2), 15% (Year 3) for below-median wages (~554,000 workers). Cost: $8,000–$12,000 (Year 3)
Affected Workers: All 32.3M documented workers.
Cost Impact: Year 3 costs eliminate savings, driving a 50–70% usage drop (16.15M–22.61M fewer workers).
3. Employee Remittance Levy
Structure (On ~$10,400 Remittances/Worker):
- < $35K: 7% (Years 1–3, constant). Cost: $728 ($10,400 × 7%)
- $35K–$60K: 9% (Year 1), 14% (Year 2), 18% (Year 3). Cost: $936–$1,872
- $60K–$100K: 9% (Year 1), 14% (Year 2), 18% (Year 3). Cost: $936–$1,872
- $100K: 9% (Year 1), 14% (Year 2), 18% (Year 3). Cost: $936–$1,872
Affected Workers: All 32.3M, worker-paid.
Cost Impact: Year 3’s $728–$1,872 reduces worker supply by 5–8% (1.61M–2.58M fewer workers).
Annualized Tax Income (2025–2028)
Structure: 15% (Year 1), 30% (Year 2), 40% (Year 3) per worker ($52K average). Cost: $7,800–$20,800.
Affected Workers: Offshore employees (14M).
Cost Impact: Year 3’s $20,800/worker adds $291.2B (14M × $20,800).
- Shift: Limits offshoring; reinforces U.S. hiring.
Breakdown of the Percentage Factor
- Year 1 (2025): A 10-20% initial drop (3.23M–6.46M fewer workers) is assumed as companies adjust mid-year, half-year impact ~1.61M.
- Year 2 (2026): Reduction increases to 12.5-17.5% (4.04M–5.65M fewer workers) as tax rates escalate.
- Year 3 (2027): Reduction reaches 50-70% (16.15M–22.61M fewer workers) as costs exceed savings.
- Year 4 (2028): Stabilizes at 50% (16.15M fewer workers), with 50% remaining due to sector needs.
Combined Effect on “Need” for Foreign Labor
- Year 1: Total tax ~$10,286–$47,186; usage dips 10-20% (3.23M–6.46M fewer).
- Year 2: Usage drops to 12.5-17.5% (4.04M–5.65M fewer).
- Year 3: Total tax ~$11,228–$121,456; usage reduces by 50-70% (16.15M–22.61M fewer).
- Year 4: Stabilizes at 50% reduction (16.15M fewer).
- Shift: ~12.92M U.S. workers (80% of 16.15M) fill gaps, leveraging 2.2M STEM/labor pool (BLS data).
Annualized Tax Income (2025–2028)
Assumptions: Worker count: 32.3M in Year 1, dropping to 16.15M by Year 4 (50% reduction).
Salary distribution: < $35K (30%, $30K), $35K–$60K (40%, $52K), $60K–$100K (20%, $80K), > $100K (10%, $120K).
Yearly Revenue (Illustrative):
- 2025 (Year 1): Work Visa: $167.61B, Payroll: $296.13B, Remittance: $27.59B, Offshoring: $98.01B, Total: $589.34B
- 2026 (Year 2): Work Visa: $255.63B, Payroll: $412.70B, Remittance: $34.18B, Offshoring: $196.01B, Total: $898.53B
- 2027 (Year 3): Work Visa: $348.43B, Payroll: $485.05B, Remittance: $36.21B, Offshoring: $249.54B, Total: $1,119.24B
- 2028 (Year 4): Work Visa: $232.95B, Payroll: $324.26B, Remittance: $24.18B, Offshoring: $124.77B, Total: $706.15B
Yearly Totals:
- Total (4 Years): $589.34B + $898.53B + $1,119.24B + $706.15B = $3,313.3B
- Annualized: $3,313.3B ÷ 4 = $828.32B/year
Taxation Summary:
The 4-Tax Pillar, 4-Tier Salary Structure Framework flips the profit motive. By Year 3, non-citizen workers cost firms $228–$110,456 more than U.S. citizen workers (e.g., < $35K: $4,628; > $100K: $121,456). Slashing reliance from 32.3M to 16.15M.
Firms hire ~12.92M U.S. workers (80% replacement), with tech shifting fastest due to high rates. Agriculture lags due to constant < $35K rates (3%, 7%, 7%) ensuring fairness for H-2A (133,000) and H-2B (84,000). Revenue averages $828.32B/year, funding continuous U.S. citizen workforce training (e.g., STEM programs for 2.2M graduates annually).
The framework proves the “need” for foreign labor is primarily economic, countered by fair, tiered levies with no exemptions.