'H1-B visa fee to squeeze IT cos' margin next fiscal'

ANALYSTS have ruled out major impact on the software industry per se due to the $100,000 fee on new H1-B visa applications on companies but from next year onwards, the move may spike the wage inflation by 10% leading to a 100-200 bps impact on margins.

- ENS ECONOMIC BUREAU @Mumbai

“The new H-1B visa fee will raise operating costs for domestic IT services companies. This adds to a possible 25% tax under the proposed HIRE Act, if American companies outsource to foreign entities,” Sweta Patodia, an associate vice-president at Moody’s Ratings said in a note Monday without quantifying the impact.