- What is the policy?
- Senator Tom Cotton (R-Arkansas) introduced the OPT Fair Tax Act in September 2025, which would end tax exemptions for foreign workers and require them and their employers to pay FICA taxes at the same rates as U.S. citizens. FICA, also known as the Federal Insurance Contribution Act, is a 7.65% payroll tax that is withheld from an employee’s gross earnings on each paycheck, and the employer matches that percentage. The money collected is used to fund Social Security and Medicare. Supporters of this bill argue that the OPT tax exemption incentivizes employers to hire foreign workers over domestic workers.
- What are recent changes?
- None
- How does it impact South Asians?
- Eliminating the OPT tax exemption would increase the financial burden on foreign workers who are already grappling with a high cost of living and tuition. This bill would also make the U.S. less appealing to South Asian students who study here with the intent to obtain a post-study work permit through OPT. Decreasing the affordability of OPT will likely cause South Asians to forego the opportunity to gain U.S. work experience and hurt their marketability around the world.