EXCLUSIVE: ‘Phantom employees' scandal spurs GOP crackdown on $36B incentive for companies to bypass Americans

ICE's discovery of more than 10,000 "phantom employees" tied to the OPT foreign-student work program has prompted GOP lawmakers to propose the "OPT Fair Tax Act," which would require employers to pay Social Security and Medicare payroll taxes for OPT workers. Analysts expect the legislation, if enacted, to raise employer labor costs and reduce the financial incentive to hire OPT participants—potentially weighing on companies and sectors (notably tech and STEM-heavy firms) that rely on international graduates. The change could boost federal revenues (estimated $27–$36 billion over 10 years) but introduce near-term policy uncertainty that may pressure US equity valuations. Offsetting effects could include greater hiring of U.S. graduates and a longer-term benefit to domestic wages and consumer demand.