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President Donald Trump is preparing to order a seismic change in federal drug policy: moving marijuana out of Schedule I and into Schedule III, sources say — the most dramatic federal shift on cannabis since 1970.
Reports across the news cycle say Mr. Trump will sign an executive order directing his cabinet to reclassify marijuana under the Controlled Substances Act, a move that would lower federal oversight of the plant and its derivatives and immediately reshape the industry and federal enforcement priorities.
Under current law, marijuana sits in Schedule I — the same category as heroin and LSD — a designation that bars recognition of medical use and severely restricts research. Axios reported that the change would shift marijuana into the less-restrictive Schedule III, a classification that today includes drugs such as ketamine, anabolic steroids and testosterone, according to the DEA.
The market reaction was immediate: cannabis stocks jumped after the initial reporting, reflecting investor expectations that federal rules — and the economics around a national cannabis market — could loosen dramatically.
Legal analysts warn the consequences would be sweeping. As one firm put it, “it will mark the greatest change to U.S. drug laws since 1970 and drastically change the state-regulated cannabis industry across 40 states.” Greenspoon Marder documented that description while laying out the potential industry and regulatory fallout.
That would not mean nationwide legalization — federal rescheduling alters enforcement, research and regulatory treatment under federal statutes but does not itself rewrite state laws. Still, the downstream effects would be immediate: licensing, banking access, research pathways and criminal enforcement priorities would all be transformed.
Tax experts say one of the biggest near-term changes would be to the federal tax code. Under current law, the harsh tax rule IRC § 280E bars normal deductions for businesses trafficking in Schedule I and II substances. Canna Law Blog warned that such a change “would not apply, and the cannabis industry would change forever.” Harris Sliwoski noted how big that fiscal shift could be for operators in states with regulated markets.
But even as reporting points to imminent action, the White House has cautioned that the matter is not final. A White House spokesperson said, “no final decisions have been made on the rescheduling of marijuana.” Multiple outlets also noted that “Trump could still change his mind” as the administration works through legal and political questions.
This is not an out-of-the-blue idea: Mr. Trump told reporters in August that his administration was “looking into rescheduling” marijuana and that he would “make a determination over…the next few weeks.” That earlier public signal helps explain why insiders and industry officials say a formal directive now appears imminent.
Conservative readers should note both the scale and the risks. Supporters will hail easier medical research, banking relief and tax parity; critics warn about modern products’ potency. As one critic told local reporters, “today’s high-potency products could bring unintended consequences” and cautioned that “The active ingredient THC is much, much stronger than it ever was 20, 30, 40 years ago.”
What happens next is legal and political theater: an executive order could push agencies to begin reclassification steps, but formal rulemaking or administrative action from HHS, DOJ or the DEA would still be required to finalize regulatory changes — and opponents are already lining up to fight or slow the process.
Expect a whirlwind in the coming days: lawmakers, agency officials, industry lobbyists and public-health advocates will all press their case as the administration decides whether to sign an order that would alter decades of federal drug policy.
What’s next: Watch for an official White House order or agency notice, legal analyses of how the administration plans to execute rescheduling, and fast-moving market reactions. The question now—beyond political spin—is how quickly the federal machinery will turn and who benefits and who pays the price for this historic policy pivot.
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Steeve Strange is the CEO and Editor-in-Chief of The Scoop. A passionate defender of conservative values and constitutional freedoms, he founded The Scoop to deliver truthful, America First journalism. Contact: [email protected]