The Chances of Cannabis Rescheduling under the Trump Administration
The conversation around rescheduling cannabis in the United States took a significant step forward with the Department of Health and Human Services (HHS) recommending a shift from Schedule I to Schedule III under the Controlled Substances Act. However, with Donald Trump now in office, the likelihood of this policy shift materialising remains uncertain.
Trump’s Stance on Cannabis: A Mixed Record
During his previous term, President Donald Trump took an ambiguous approach to cannabis policy. While he expressed support for states’ rights regarding marijuana legalisation, his administration included officials who actively opposed marijuana reform, such as former Attorney General Jeff Sessions. Sessions rescinded the Obama-era Cole Memorandum, which provided guidance to federal agencies to de-prioritise enforcement against state-legal marijuana businesses. Despite this, Trump later expressed a willingness to support the STATES Act, a bill that would have protected state-legal cannabis markets from federal intervention, although it never passed.
Potential Policy Direction Under a Second Trump Term
1. Increased Uncertainty in Federal Policy
Under the Trump administration, federal cannabis policy remains unpredictable. While the recommendation to reschedule cannabis to Schedule III came from HHS, the Drug Enforcement Administration (DEA) has the final say. Trump’s appointments to key positions within the DEA and the Department of Justice (DOJ) could influence whether rescheduling moves forward or stalls.
2. Potential Reversal of Executive Support
Under the previous Biden administration, federal agencies showed support for rescheduling and broader cannabis reform, with Biden issuing pardons for certain federal marijuana offences. Trump, on the other hand, has not explicitly supported marijuana reform and could potentially halt or reverse ongoing policy changes. If the rescheduling process remains unresolved, the Trump administration could delay or block the measure.
3. Impact on Industry and Financial Sector
Reclassification to Schedule III would provide cannabis businesses with crucial benefits, including access to mainstream banking services and relief from Section 280E of the tax code, which currently prevents cannabis businesses from deducting normal business expenses. If Trump were to block reclassification, the cannabis industry would continue to face significant financial and regulatory hurdles, limiting its growth potential.
4. Congressional Gridlock and Legislative Hurdles
The likelihood of cannabis reform passing Congress under the Trump administration remains low unless the legislative landscape changes dramatically. While bipartisan support for cannabis reform has grown, a Republican-led Senate or House could impede progress on comprehensive legalisation efforts. Without strong support from the executive branch, Congress may struggle to pass meaningful marijuana reform, leaving federal prohibition largely intact.
Reclassification: Will It Happen?
The timetable for rescheduling remains a critical factor. If the DEA finalises its decision soon, reversing the policy could prove difficult, even for Trump. However, if the decision remains unresolved, Trump’s influence could determine whether reclassification moves forward or stalls indefinitely.
Conclusion: A Future in Limbo
The future of cannabis rescheduling under the Trump administration remains highly uncertain. While public opinion overwhelmingly supports marijuana reform, the potential for policy reversals or delays under Trump could hinder progress. The cannabis industry, investors and advocates must prepare for a range of scenarios, from full reclassification to prolonged federal inaction.
As cannabis policy continues to evolve under the Trump presidency, industry stakeholders must remain vigilant. The success of rescheduling may depend on the administration’s willingness to align itself with the growing wave of state-level legalisation and public demand. Until then, the cannabis industry remains in a state of cautious anticipation, waiting to see if federal policy will finally shift in its favour.