The shift represents the most consequential change in U.S. cannabis policy in over half a century.

This wasn’t a sudden decision. Trump’s evolution on cannabis accelerated during his campaign when he stated: “I believe it is time to end needless arrests and incarcerations of adults for small amounts of marijuana for personal use.”

The Numbers Behind the Policy Change

More than 30,000 licensed healthcare practitioners across 43 U.S. jurisdictions now authorize medical marijuana recommendations. They serve over 6 million registered patients treating at least 15 medical conditions.

Chronic pain affects nearly 1 in 4 U.S. adults and more than 1 in 3 seniors. Six in 10 people who use medical marijuana report doing so to manage pain.

Public opinion has shifted dramatically. A Gallup poll shows 64% of U.S. adults believe cannabis should be legal. Pew Research Center found 66% of Democrats and 43% of Republicans support legalizing marijuana for both medical and recreational use.

Only 11% of Americans say the drug should remain illegal.

The Tax Relief Impact on Cannabis Businesses

Moving cannabis to Schedule III eliminates one of the industry’s biggest financial burdens: IRS code 280E.

This provision prohibits deducting business expenses from income derived from “trafficking” Schedule I or II substances. State-legal cannabis operations currently pay tax on their gross income at rates as high as 70 to 80 percent.

Cannabis businesses operate without the tax breaks afforded to “regular” businesses. Rescheduling changes that calculation entirely.

The cannabis industry recognized the stakes. American Rights and Reform PAC, backed by the cannabis industry, aired pro-marijuana ads targeting Trump’s TVs at the White House and Mar-a-Lago. Federal Election Commission records show the PAC donated $1 million in March to MAGA, Inc., a Trump-aligned super PAC.

Medicare CBD Coverage Creates New Market Access

The Centers for Medicare and Medicaid Services, led by Dr. Mehmet Oz, plans to launch a pilot program in April. The program enables certain Medicare-covered seniors to receive free, doctor-recommended CBD products.

Products must comply with all local and state laws on quality and safety.

This brings cannabis-derived therapies into federally insured health care for the first time. The implications for market access are substantial.

The senior population represents one of the fastest-growing segments of medical cannabis users, particularly for pain management and sleep disorders.

Industry Response and Market Implications

Cannabis stocks responded immediately to the announcement. The policy shift addresses three critical industry challenges:

• Tax burden reduction through elimination of 280E restrictions
• Banking access through potential SAFE Banking Act advancement
• Federal research expansion enabling more clinical studies

Trump’s campaign statement indicated he would “work with Congress to pass common sense laws, including SAFE banking for state authorized companies.”

The banking issue has plagued cannabis businesses for years. Most operate on a cash-only basis because banks fear federal prosecution for serving marijuana companies.

What This Means for Federal Enforcement

Rescheduling doesn’t legalize marijuana at the federal level. It changes how the federal government classifies and regulates the substance.

Schedule III drugs have accepted medical uses and lower potential for abuse than Schedule I or II substances. This classification opens doors for medical research that previous restrictions blocked.

The executive order directs expedited action but requires the attorney general to complete the formal rescheduling process. This involves regulatory procedures that take time.

The timeline matters for businesses planning capital investments, expansion strategies, and compliance frameworks.

The Research and Medical Use Expansion

Federal restrictions on cannabis research have limited clinical studies for decades. Rescheduling removes many of these barriers.

Universities and research institutions can pursue studies without the extensive approval processes required for Schedule I substances. This accelerates understanding of cannabis efficacy for various medical conditions.

The medical community has pushed for this change. Evidence supporting cannabis use for chronic pain, PTSD, and other conditions has accumulated despite research limitations.

Expanded research access will generate the clinical data needed for evidence-based medical recommendations and insurance coverage decisions.

State-Level Impact and Interstate Commerce

Thirty-eight states have legalized medical marijuana. Twenty-four states allow recreational use. Federal rescheduling creates new dynamics for state programs.

Interstate commerce remains prohibited under current law. Cannabis businesses can’t transport products across state lines, even between states where marijuana is legal.

Rescheduling doesn’t immediately change this restriction. However, it creates a framework for potential future modifications to interstate commerce rules.

The tax and banking changes will affect how state-legal businesses operate and expand within their jurisdictions.

Looking Forward

Trump’s executive order sets a new direction for federal cannabis policy. The practical implementation will unfold over months as regulatory agencies complete formal processes.

Industry stakeholders are watching several key areas: the timeline for final rescheduling, Congressional action on banking legislation, and Medicare CBD program details.

The policy shift reflects changing public opinion and growing evidence of medical cannabis benefits. It also represents recognition of the economic and social costs of current enforcement approaches.

The cannabis industry enters a new phase of legitimacy and growth potential. How quickly businesses can capitalize on these changes depends on regulatory implementation speed and market adaptation.