U.S. Foreign Labor Levy Legislative Proposal
(Updated January 2026)
The U.S. Foreign Labor Levy proposal establishes a 4-Pillar, 4-Tier Salary Framework targeting ~32.6 million documented non-citizen workers and students across all U.S. industries (latest estimates as of January 2026).
Its primary goal is to rebalance corporate incentives toward hiring qualified U.S. citizen workers by removing the profit advantage of relying on legal non-citizen 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 (< $37K**, **$37K–$63K**, **$63K–$105K**, **> $105K; adjusted for 2025 inflation). Rates for workers under $37K remain constant to protect industries where U.S. citizens are less likely to participate.
Additionally, the Offshoring Levy addresses remote foreign hiring. Undocumented workers (~14M, updated Pew 2025 estimates) 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 ~32.6 million documented workers and students between 2026 and 2029, estimating both the tax revenues generated and the number of jobs transitioned back to qualified U.S. citizen workers, assuming a 50% overall reduction in corporate reliance on legal non-citizen labor and students over the period, with 80% of those positions filled by qualified U.S. citizen workers (yielding ~13 million restored jobs and educational opportunities).
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 ~32.6 million documented, working non-citizen workers and students annually, updated with verified data as of January 2026:
Visas (~1.14M):
- H-1B: ~120,603 (USCIS FY2025 selected registrations)
- H-2A (Agricultural): ~150,000 (DOL 2025 estimates)
- H-2B (Non-Agricultural): ~100,000 (USCIS FY2025)
- TN, L-1, J-1, OPT, and other visas adjusted to ~1.14M total.
Green Cards (Legal Permanent Residents, LPRs, ~13M in Workforce):
13 million working LPRs (48.1% labor participation from ~27M total LPRs).
Humanitarian with Work Authorization (~3.4M):
Adjusted to ~3.4 million (DACA, TPS, asylum, parolees, etc.).
Offshore Foreign Employees (~14M): ~14 million (BEA 2025 estimates).
Foreign Student Enrollment with Work Options (~1.1M): ~1.1 million (F-1/OPT/CPT, IIE Open Doors 2025).
Salary Distribution (BLS 2025, Adjusted for Inflation):
- < $37K: 30% (~9.78M workers, ~$32K average)
- $37K–$63K: 40% (~13.04M workers, ~$55K average)
- $63K–$105K: 20% (~6.52M workers, ~$84K average)
- $105K: 10% (~3.26M workers, ~$126K average)
- Overall Average Wage: ~$61K (weighted).
Profit Edge: Non-citizen workers save firms ~$11,500 per worker annually (wage gaps, tax breaks), totaling ~$374.9B industry-wide.Impact of the Four
Tax Pillars - Impact of the Four Tax Pillars
1. Work Visa and Employment Levy
Structure (Per Worker, Tiered by Salary):
- < $37K: 3% (Years 1–3, constant)
- $37K–$63K: 7% → 14% → 20%
- $63K–$105K: 10% → 18% → 28%
- $105K: 15% → 25% → 45%
- H-1B/L-1 Surcharge for below-median wages.
Cost Impact: By Year 3, costs exceed savings, reducing usage by 40–60%.
2. Foreign Worker Payroll Levy
Similar tiered escalation on wages.
Cost Impact: Year 3 costs eliminate savings, driving 50–70% usage drop.
3. Employee Remittance Levy
On ~$10,400 remittances/worker; constant low-tier, escalating higher.
Cost Impact: Reduces worker supply by 5–8%.
4. Offshoring & Remote Labor Levy
15% → 30% → 40% on ~$61K average.
Directly addresses the ~14 million offshore black hole.
Breakdown of the Percentage Factor
- Year 1 (2026): 10–20% initial drop
- Year 2 (2027): 12.5–17.5% reduction
- Year 3 (2028): 50–70% reduction
- Year 4 (2029): Stabilizes at 50% (~16.3M fewer workers).
Combined Effect on “Need” for Foreign Labor
Shift: ~13 million qualified U.S. citizen workers fill gaps (80% replacement).
Annualized Tax Income (2026–2029)
Yearly Revenue (Illustrative):
- 2026 (Year 1): ~$598B
- 2027 (Year 2): ~$925B
- 2028 (Year 3): ~$1,142B
- 2029 (Year 4): ~$740B
Yearly Totals:
Total (4 Years): ~$3,405B
Annualized: ~$851B/yearTaxation Summary:
The 4-Tax Pillar, 4-Tier Framework flips the profit motive. By Year 3, non-citizen workers cost firms significantly more than U.S. citizen workers. Reliance drops from ~32.6M to ~16.3M.
Firms hire ~13 million qualified U.S. citizen workers (80% replacement), with tech shifting fastest and low-wage sectors protected. Revenue averages ~$851B/year, funding continuous U.S. citizen workforce training.
The framework proves the “need” for foreign labor is primarily economic, countered by fair, tiered levies with no exemptions.