Cannabis has been rescheduled, what does this mean?
Cannabis has been officially rescheduled from a schedule I drug to a schedule III, as signed by Trump today, on the 18th of December, 2025. Schedule I drugs are substances considered by the DEA to be “drugs with no currently accepted medical use and a high potential for abuse.” Schedule III drugs, by the DEA’s definition, are: “drugs with a moderate to low potential for physical and psychological dependence.”
Moving cannabis from a I to a III seems like a good thing, right? Well, it’s not so simple.
The White House has issued a declaration stating that their intentions with rescheduling are to “allow research studies to incorporate real-world evidence and models that can assess the health outcomes of medical marijuana and legal CBD products while focusing on long-term health effects in vulnerable populations like adolescents and young adults.”
Basically, re-classifying cannabis allows medical facilities to conduct studies on the drug with less legal barriers, and it means cannabis businesses will no longer fall under Section 280E of IRS tax code, which prohibits businesses involved in the "trafficking" of Schedule I and Schedule II substances from deducting "ordinary and necessary" business expenses from their taxes, meaning better tax breaks for cannabis businesses.
It sounds great! Right? This is where the tricky part comes in.
All this testing will hopefully eventually lead to an FDA-approved status, which means cannabis products can be sold more freely. But it hasn’t been approved yet. So, for now, nothing much changes.
This is all good (or neutral) news for the most part, but some cannabis businesses are wary of the change.
Some cannabis market insiders (via high-times magazine) believe the move is due to the administration’s realization of the monetary potential of cannabis. Basically, they’ve seen the money the cannabis market makes in the individual states, and they want a piece of the pie.
More freely-sold cannabis should be a good thing, especially for consumers, but it may not be so good for the cannabis industry.
Cannabis products will potentially be government-produced through contracts with specific companies, like many pharmaceutical drugs are now.
In the long run, this could be great if the rules are re-structured for the recreational cannabis market, but if the government intends to sell cannabis in a regulated market similar to the pharmaceutical markets we have today, it could be detrimental to the locally-owned businesses in each individual state.
For now, we hold our breath and wait.