The Department of Justice has signed an order regarding the reclassification of state-licensed medical marijuana.
In the reclassification, officials labeled it a less dangerous substance. The move marks a significant federal cannabis policy change in decades.
Attorney General Todd Blanche reclassified legal medical marijuana from Schedule I — the most restrictive, which includes drugs like heroin and ecstasy — to Schedule III, which includes prescription drugs like ketamine and Tylenol with codeine.
While this order does not legalize the recreational use of marijuana federally, it does provide a huge tax break for those who legally sell medical marijuana.
Writing on X (formerly known as Twitter), Blanche stated, “These actions will enable more targeted, rigorous research into marijuana’s safety and effectiveness, expanding patient access to treatments.”
The announcement was made after President Donald Trump issued an executive order to the Justice Department to speed up the reclassification process.
For medical marijuana companies, the immediate change is related to taxes.
However, since marijuana was previously categorized under Schedule I, deductions for ordinary business expenses such as rent, wages or advertising were prohibited under the guidelines of the Internal Revenue Service’s Section 280E. This caused the effective corporate tax rate to rise to 70 per cent. or more.
At the same time, companies can attract more investors, secure loans and easily access traditional banking services.
Patients, on the other hand, won’t see direct changes in access or pricing right away.
