Trump Executive Order Accelerates Marijuana Rescheduling, Stops Short of Federal Legalization

President Donald Trump signed an executive order on December 18, 2025, directing the Department of Justice to expedite the rescheduling of marijuana from Schedule I to Schedule III under the Controlled Substances Act. While hailed as a significant step for medical cannabis, the order explicitly does not legalize cannabis federally for recreational or broad commercial use across the United States.

A Landmark Shift for Medical Cannabis, But Not Full Decriminalization

The executive order, titled "Increasing Medical Marijuana and Cannabidiol Research," marks a pivotal moment in federal drug policy, acknowledging marijuana's accepted medical uses for conditions such as pain, nausea, and anorexia, and recognizing its lower abuse potential compared to Schedule I drugs. This directive builds upon a process initiated in 2022 under President Biden, with recommendations from the Department of Health and Human Services (HHS) in August 2023 and subsequent proposals from the Department of Justice (DOJ) in 2024.

However, the move to Schedule III, while significant, does not equate to federal legalization. Under Schedule III, marijuana would still be federally controlled, requiring prescriptions and DEA registration for manufacturers and distributors. This distinction is crucial, as Schedule I drugs are deemed to have no accepted medical use and a high potential for abuse, making them illegal to possess, sell, or cultivate federally. The executive order, therefore, aims to ease restrictions on medical research and access, rather than to end the federal prohibition on recreational use.

Key Directives and Immediate Impact of the Executive Order

President Trump's executive order on December 18, 2025, instructs the Attorney General to "take all necessary steps to complete the rulemaking process... in the most expeditious manner." This action is intended to accelerate a process that has seen delays, including a postponed DEA hearing originally set for January 21, 2025.

Beyond rescheduling, the executive order also initiates a Medicare pilot program designed to expand access to hemp-derived CBD for seniors. It further prioritizes federal research into cannabis and urges Congress to clarify definitions for hemp cannabinoids, including THC limits per serving and CBD:THC ratios. Simultaneously, the order seeks to restrict intoxicating products like Delta-8 THC, aligning with congressional limits established in November 2025.

In a statement, President Trump framed the executive order as a "common-sense change" beneficial for patients, veterans, and as a potential alternative to opioids. Public discussions on social media platforms, particularly under hashtags like #Trump and #Marijuana, reveal a mix of support for reform, with many users emphasizing the need for comprehensive change for "real equity" and "individual freedom."

Reactions and Industry Implications

The announcement has elicited varied responses from stakeholders. Adam J. Smith, Executive Director of the Marijuana Policy Project, acknowledged the executive order as a "step" toward facilitating research and offering tax relief for the industry. However, Smith also emphasized that it is insufficient, advocating for full descheduling to end arrests and resolve persistent state-federal conflicts. The ongoing debates about the commercialization and cultural shift within the cannabis industry are also reflected in online discussions, with concerns about the transition from a community-driven culture to a corporate-dominated industry.

For the cannabis industry, the rescheduling to Schedule III could bring significant, albeit limited, benefits. Most notably, it offers potential relief from the notorious 280E tax code, which currently denies federal tax deductions for businesses dealing in Schedule I or II substances. This could provide a "lifeline" to the hemp industry by easing restrictions and improving business operations. However, cannabis businesses would still operate under federal control, requiring compliance with stringent regulations akin to other Schedule III pharmaceuticals.

What the Executive Order Does and Does Not Do

It is critical to understand the actual effects of this executive order. Marijuana is definitively "not now legal" federally. The order solely expedites the rescheduling process.

• Federal Legality: Currently, marijuana remains a Schedule I substance, illegal to possess, sell, or cultivate federally. Post-rescheduling, it would become a Schedule III substance, recognized for medical use but still federally controlled. This means it would require prescriptions and DEA registration for those involved in manufacturing and distribution. Recreational use would remain federally prohibited.
• State Markets: While over 38 states have legalized medical or recreational cannabis, federal banking and tax barriers have largely persisted. Rescheduling may ease some research and tax issues for medical cannabis businesses, but it does not resolve the fundamental conflict between state and federal laws, nor will it immediately end federal arrests for possession.
• Research & Access: The Schedule I classification has severely limited federal research into cannabis. The executive order is expected to boost clinical trials and launch the Medicare CBD pilot, enabling real-world data collection on full-spectrum CBD products.
• Workplace & Employment: The executive order has no immediate impact on private sector drug testing policies, and federal employees will continue to face restrictions regarding marijuana use.
• Banking & Taxes: The cannabis industry has largely been cash-only due to federal prohibitions and faces high taxes. Rescheduling to Schedule III could bring potential 280E tax relief for medical cannabis products, which would significantly aid regulated businesses.

The White House has confirmed that the executive order "does not make marijuana use legal across the board" and maintains its focus on medical research rather than recreational legalization.

The Road Ahead: Uncertainties and Future Developments

In the short term (weeks to months), the Department of Justice and the DEA are expected to finalize the rulemaking process, potentially through an expedited hearing. Concurrently, the Medicare CBD pilot program is slated to launch, and agencies like HHS, FDA, and NIH will work on developing standards for hemp products.

Medium-term prospects include increased medical research, which could lead to wider adoption of cannabis as an opioid alternative. Congress may also be prompted to act on clearer CBD and hemp regulations. The industry anticipates gains from improved tax conditions and enhanced research access, although recreational sales will remain confined to state-legal markets.

Long-term uncertainties remain, particularly regarding the path to full federal legalization. This executive order does not provide such a pathway, and advocates continue to push for complete descheduling through legislative action. Potential delays or opposition from the DEA, despite the presidential directive, could slow progress. Meanwhile, state-level expansions of cannabis legalization are expected to continue independently. If rescheduling is successfully completed, it will set a significant precedent for further reforms but will still leave approximately 50% of adults in state-legal areas facing federal restrictions.

Social media discussions highlight concerns about "outdated laws vs. modern science," with many users calling for policies to catch up with scientific evidence and public health responses. The ultimate impact of President Trump's executive order will depend on the speed and thoroughness of the DEA's actions and the willingness of Congress to address the broader landscape of cannabis policy.