President Trump Finally Takes Executive Action to Federally Reschedule Marijuana

President Donald Trump today issued an executive order directing federal agencies to amend marijuana’s longstanding classification as a Schedule I federally controlled substance without accepted medical value. The order seeks to finalize a 2023 recommendation by the US Department of Health and Human Services calling for cannabis to be rescheduled to a Schedule III controlled substance. Specifically, it reads, “The Attorney General shall take all necessary steps to complete the rulemaking process related to rescheduling marijuana to Schedule III of the CSA in the most expeditious manner in accordance with Federal law.”

Other important parts of the Executive Order are:

• Direct top White House staff to work with Congress to give patients access to full-spectrum CBD products, “while still restricting the sale and access to products that cause serious and potentially life threatening health risks.”
• Urge Congress to examine updating the definition of hemp to ensure that full-spectrum CBD is accessible to patients—a policy change that could mitigate some concerns in the sector about a recent spending bill Trump signed with provisions that would broadly ban consumable hemp products.
• Direct the U.S. Department of Health and Human Services (HHS) to “develop research methods and models, to utilize real world evidence [and] to improve access to hemp-derived CBD products in accordance with federal law” while informing “standards of care.”

While this is an important first step at the federal level to bring rationality to federal cannabis policy as it will help patients and veterans, it fails to legalize the recreational use of cannabis on the federal level.  It will still be illegal to transport cannabis across state lines.  The federal government can still also prosecute people in the 24 states that have legalized cannabis who follow sate law.

After helping patients, the biggest benefit of reclassification is tax fairness.  Cannabis businesses will now be able to take all of the standard deductions that other businesses can take.

If you have questions on the executive order, please contact us to set up a time to chat.  And stay tuned to see what comes next, especially on the hemp side of cannabis.