U.S. Tourism Faces Setback as Visa Fees, Prices Rise, Dollar Slump

(USA) The United States will impose a new $250 visa integrity fee on foreign travelers from October 1, 2025, pushing the total cost of a visitor visa to $442, a move industry leaders say will deter international visitors at a moment when tourism is already slowing. Despite a weaker dollar that would normally make the country cheaper for overseas travelers, forecasts show fewer arrivals, lower spending, and a tighter year ahead for hotels, airlines, and local businesses that rely on global tourism.

International visitor spending is projected to fall to just under $169 billion in 2025, down from $181 billion in 2024, according to industry assessments shared with stakeholders. The drop—roughly $12.5 billion in lost spending this year—comes as travel companies report softer demand from several key markets and a growing list of cost pressures that make U.S. trips harder to justify for families abroad. Analysts say the new visa integrity fee will add to that strain by raising entry costs for travelers from countries outside the visa waiver program, including Mexico, Argentina, India, Brazil, and China.

The fee lands as a weaker dollar fails to deliver the usual boost to inbound tourism. Historically, a currency dip makes U.S. hotels, restaurants, and attractions more affordable to overseas visitors. This year, however, that tailwind has been blunted by higher visa costs and the domestic price surge on the ground—from lodging and dining to car rentals and event tickets—that makes trips feel more expensive once travelers arrive. The dollar’s slide is affecting Americans heading overseas more noticeably, as foreign trips become pricier for U.S. travelers, but it has not translated into a rebound in inbound demand.

Travel companies are already registering the shift. International arrivals in 2025 are expected to decline by 9.4%, with pronounced drops from Canada and Europe. Leisure bookings from Canada are down by 40%, and Europe saw a 17% drop in March 2025. Hoteliers report softer occupancy, with a 9% decline that is cutting into revenue at city centers and beach destinations alike. Airlines are trimming international capacity, aligning flight schedules with thinner demand and trying to protect yields as booking curves shorten and price sensitivity grows.

Industry voices say the visa integrity fee adds friction at the front end of the trip, and that even modest barriers can change behavior, especially among price-sensitive travelers or larger families.

“Any friction we add to the traveler experience is going to cut travel volumes by some amount,” said Gabe Rizzi, President of Altour.
That calculus is more acute for travelers who must also budget for higher hotel rates, fueling, and dining costs stateside, which remain elevated compared with pre-pandemic levels.

The new charge will lift the total cost of a visitor visa to $442, a noticeable increase for travelers from countries where average incomes are lower and where trips to the United States require more paperwork, longer planning windows, and, in some cases, extensive travel within their home country to attend interviews. Industry estimates suggest the visa integrity fee alone could lead to 1 million fewer visits to the U.S. in 2026 and 3.5 million fewer visits by 2028. For many destinations that depend on international visitors—national parks, major museums, convention hubs, and coastal resorts—the projected decline translates into fewer room nights, leaner restaurant shifts, and quieter attractions during shoulder seasons.

Tourism groups warn that the knock-on effects stretch far beyond hotels and airlines. The travel sector supports more than 20 million jobs across the United States, spanning airport ground crews, rideshare drivers, retail clerks, restaurant staff, tour guides, housekeepers, and tradespeople servicing venues and attractions. Because tourist spending flows directly into local tax bases through sales and occupancy taxes, a downturn can also pinch city budgets that fund public services, cultural programs, and transport infrastructure. When international visitors cut trips, big cities feel it first, but smaller communities anchored by major parks, festivals, or heritage sites can be hit harder, with fewer alternatives to fill the gap.

“This is a wake-up call for the U.S. government. The world’s biggest Travel & Tourism economy is heading in the wrong direction, not because of a lack of demand, but because of a failure to act. While other nations are rolling out the welcome mat, the U.S. government is putting up the ‘closed’ sign,” said Julia Simpson, WTTC President & CEO.
Her remarks reflect a broader concern among tourism executives that policy choices—fee hikes, interview bottlenecks, and tighter entry processes—can weigh on recovery even when global appetite for travel remains strong.

The effect is uneven across markets. Families in Latin America weighing a two-week U.S. holiday now face higher up-front visa costs on top of airfare and lodging, while travelers from Europe who do not need visas still encounter higher spending once in the country. For potential visitors in India, Brazil, and China, the combined price tag can push a trip into next year—or shift plans to countries with simpler entry requirements or lower fees. Even for business travelers, who are less price sensitive than holidaymakers, rising costs can lead to shorter stays, fewer team trips, or a switch to virtual meetings.

Travel advisers say the psychology of added fees matters. When travelers see a new visa integrity fee and then compare hotel rates and restaurant prices in U.S. cities, some choose alternatives elsewhere. The weaker dollar is not closing the gap enough to offset that sticker shock. In normal times, a currency swing might entice first-time visitors to major gateways, but the current mix of higher entry costs and domestic inflation is dulling the appeal. For families calculating a full trip cost—from application and appointment fees to long-haul flights and a week of sightseeing—the deterrent is additive.

The timing is delicate for tourism businesses that rebuilt staffing and services as travel rebounded in 2023 and 2024. A cooling in international demand means some hotels will scale back staff hours, while airlines may reassign widebody aircraft to more resilient routes or delay the launch of new connections. Airports that invested in expanded international facilities could see slower-than-expected throughput, affecting vendor contracts and concession revenue. Cities that rely on big international events—sporting tournaments, conventions, art fairs—may adjust projections for attendance and spending, particularly if corporate travel budgets tighten alongside the consumer pullback.

Officials have defended visa screening measures in recent years as part of broader border management goals, but industry groups argue that entry processes can be secure without becoming prohibitively costly. The U.S. Department of State directs travelers to its official U.S. visas portal for information on visitor visas and fee requirements. Travel companies say clearer communication about timelines and costs can help, but they maintain that fee increases hit hardest in markets the United States has been trying to court back since the pandemic, such as long-haul leisure travelers from Asia and South America.

The forecasted declines from Canada and Europe underscore how costs ripple through even mature, high-frequency markets. For Canadians, a 40% slide in leisure bookings puts cross-border weekend trips, family visits, and winter getaways in sharper focus, with travelers opting to stay closer to home or choosing destinations where spending stretches further. In Europe, a 17% drop in March reflects both seasonal softness and a broader recalculation as travelers weigh airfare and on-the-ground costs. These trends compound the overall 9.4% expected decline in international arrivals this year.

Business leaders warn that once travelers skip a destination for a year or two, momentum can be hard to rebuild. Word-of-mouth shifts, alternative itineraries become traditions, and airlines adjust schedules toward steadier demand. That dynamic is particularly relevant to repeat visitors—the backbone of many tourism markets—who might otherwise return every couple of years for family reunions, shopping, or cultural events. If the visa integrity fee suppresses that cycle, the drag could persist even after the currency environment improves.

For now, the headline numbers point to a slower 2025 for U.S. tourism despite the weaker dollar. The combination of the new $250 visa integrity fee, a high domestic price base, and airline capacity cuts has created a tougher environment for inbound travel. Travel executives say the trend can be reversed with a mix of policy adjustments and industry competitiveness, but they caution that the window is narrowing as other countries streamline entry and promote value. As Simpson put it,

“This is a wake-up call for the U.S. government,”
a message echoed by front-line operators, who see fewer international visitors walking through the doors and more trips deferred to 2026 or diverted elsewhere.

Rizzi’s warning that

“Any friction we add to the traveler experience is going to cut travel volumes by some amount”
is already playing out across airports and hotel lobbies. With international visitor spending projected to slide to just under $169 billion and an estimated $12.5 billion in revenue at risk this year, the stakes for communities that depend on tourism are clear. The months ahead will test whether the United States can balance visa integrity with a welcoming posture, and whether the pull of its cities, parks, and cultural life can overcome higher costs that meet travelers long before they reach the border.