President Donald Trump signed an executive order on Thursday to move cannabis from Schedule I to Schedule III, easing federal restrictions and potentially transforming the industry. The order directs the Justice Department to start the process for rescheduling, which could open doors for more research, medical use, and easier business operations—such as removing the punitive tax rule 280E.
Trump highlighted the medical benefits of cannabis and discussed the move with health officials and industry leaders. The shift aims to create clearer regulations, boost medical research, and allow companies to deduct expenses more freely.
The order also supports research on hemp-derived CBD and encourages Congress to clarify CBD regulation, possibly classifying it as a dietary supplement. The move does not legalize marijuana federally or take immediate effect but restarts a formal review process that was paused.
While over 40 states allow medical or recreational use, federal classification remains a barrier, especially regarding banking access, which may require further legislation like the SAFE Banking Act.