The recent hike in the U.S. tourist visa fee to $250 has triggered a sharp decline in inbound travel, with international arrivals dropping 8.2% and visitor spending expected to shrink by $12.5 billion in 2025. According to projections from the World Travel & Tourism Council ahead of Memorial Day, the United States stands alone among 184 countries studied, as the only nation anticipating a fall in foreign visitor spending next year.
Tourism Economics now anticipates an 8.2% drop in international arrivals to the U.S. in 2025, a sharp reversal from its December 2024 projection of a 9% increase. “Last December, the forecast projected an approximate 9 per cent increase in overall international arrivals to the U.S. for 2025”, as per the report.
Tourism Economics has revised its forecast for U.S. tourism revenue, cutting it from $184 billion to $169 billion. The downgrade comes amid growing concerns over visa restrictions, trade tensions, and controversial remarks by President Donald Trump suggesting U.S. claims over Greenland and parts of Canada.
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Canada has emerged as a major source of competition for the U.S. travel and tourism sector, representing 28% of all international visitors to the country. While business travel has held steady, the decline is primarily seen in leisure travel, the segment that generates the bulk of tourism revenue.
The U.S. economy is feeling the impact of Trump’s new immigration policies, which have made entry more difficult, contributing to a sharp $12.5 billion drop in travel spending from $184 billion in 2024 to an estimated $169 billion this year.
The situation has been further complicated by the Trump administration’s stance on Canadian immigration rules, trade tariffs, and provocative remarks about U.S. claims on Canadian territory. Canadians, who make up over 28% of international visitors to the U.S. each year, have significantly reduced their travel, with air bookings falling 35–43% year-on-year, according to Travel data.
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While the Biden administration had previously explored higher vetting fees, it was under Trump that the Department of Homeland Security and the State Department introduced the “visa integrity fee” to fund fraud prevention, background checks, and measures against visa overstays. An additional $250 has been tacked onto existing visa application fees for several categories, including tourist (B1/B2), student, and work visas. This brings the total cost to roughly $442 per visa, making it one of the priciest in the world.
The decline in Indian travelers mirrors a broader slowdown in U.S. tourism. In June 2025, India recorded its first decline in travel to the U.S. in over 20 years. Data from the U.S. Commerce Department’s National Travel and Tourism Office (NTTO) indicates that 210,000 Indians visited the U.S. in June, down 8% from 230,000 in June 2024. Preliminary numbers for July suggest a further 5.5% year-on-year decrease.
India continues to rank as the fourth-largest contributor to U.S. tourism. Excluding Mexico and Canada, which benefit from shared land borders, India stands as the second-largest overseas market after the United Kingdom. Along with Brazil, these five countries accounted for nearly 60% of all international arrivals in June, according to NTTO data. With a diaspora of more than five million, the U.S. continues to draw strong travel demand from India. Yet, analysts caution that prolonged visa appointment wait times and tougher approval norms could slow momentum in the coming years, even though many Indians are still traveling on existing 10-year multiple-entry visas as reported by The Economic Times.
As the U.S. tourism industry braces for broader declines, India and Canada stand out as pivotal markets shaping the outlook. Canada, historically the largest source of international visitors, is showing signs of strain with reduced air bookings, while India, the fastest-growing long-haul market, has just recorded its first dip in more than two decades. Together, the two countries highlight both the resilience and vulnerabilities in America’s travel sector, making future policy decisions on visas and immigration critical to sustaining these vital streams of visitors.