Context:

A FOX News exclusive reports that discovering 10,000 foreign students tied to ‘phantom employees’ in the OPT program has galvanized Republicans to target the tax incentive that favors foreign workers over Americans. Rep. Glenn Grothman introduced the OPT Fair Tax Act to require employers to pay the same Social Security and Medicare payroll taxes for OPT workers as for Americans, arguing the loophole undermines American graduates’ job prospects. ICE officials describe OPT as a ballooning, uncontrolled guest-worker pipeline with widespread fraud by top employers, intensifying scrutiny of program integrity. Supporters say closing the loophole would raise federal revenue and level the playing field for U.S. graduates, while critics warn of unintended consequences for international students and research institutions. A broader political push links immigration policy, labor market fairness, and national workforce preparation ahead of upcoming votes.

Dive Deeper:

• Acting ICE Director Todd Lyons disclosed that investigators identified over 10,000 foreign students who claimed employment with highly suspect employers, noting this was among the top 25 OPT employers and described as merely the tip of the iceberg in a larger fraud network.

• Representative Glenn Grothman, R-Wis., introduced the OPT Fair Tax Act in the House to end the payroll-tax exemption for OPT participants, arguing that eliminating the loophole would create a level playing field and prevent artificially depressed competition for American graduates.

• Grothman cited Institute for Progress data estimating about 330,000 OPT participants annually from 2017–2022 and projected that closing the exemption could boost federal revenue by $27–$36 billion over ten years, framing the issue as a substantial fiscal lever.

• Lyons characterized OPT as a ballooning system that had become an uncontrolled guest-worker pipeline, with fraud expanding in step with program growth and a surge in questionable employers leveraging work authorizations.

• The reporting ties the crackdown to a broader GOP narrative about safeguarding American jobs and integrity in federal programs, while urging Congress to prioritize native workers and scrutinize employers who exploit the OPT framework.

• Senate consideration is implied through parallel bills, with Cotton having introduced a companion measure; the article emphasizes ongoing scrutiny of OPT and the alleged mismatch between policy incentives and national workforce interests.

• Officials and advocates frame the issue as urgent for protecting American graduates and ensuring employers hire Americans first, while critics warn about potential negative effects on international students and research talent pipelines.