The Trump administration’s mantra is to cut waste and cut costs. So, it might seem unthinkable that the federal government would give an addictive industry a tax cut. But that’s exactly what many are proposing.
Last year, companies that make highly addictive and dangerous drug products spent more than $4.5 million convincing lawmakers that today’s high-potency marijuana and psychoactive THC drugs are safe. Among their top priorities was supporting former president Joe Biden‘s push to make marijuana a Schedule III drug. That would cost the federal government billions in revenue at a time when it needs every penny to close the budget gap and assist middle-income Americans struggling with inflation.
The addiction industry has marketed the effort to reclassify marijuana as a leap forward for research and criminal justice reform. In reality, it is neither of those things. Extensive research already occurs on marijuana in the United States and Europe, which is why we have a growing corpus of scientific and medical data about its harms, which include a significant risk of psychosis and schizophrenia. President Biden already signed a law in December 2022 that expanded research opportunities for marijuana without rescheduling the drug.
Criminal justice reform won’t be achieved, either. Rescheduling would not reduce any existing criminal penalties and, according to reports as recently as December 2023, no one is even in federal prison simply for possession of marijuana (you’d be hard pressed to find any in state prison, either).
Why, then, is Big Marijuana so desperate for rescheduling? It’s simple: it would save the industry over $2 billion annually. The crux of the issue is just one sentence in the IRS tax code, known as Section 280E. This provision prevents businesses that traffic in Schedule I or II drugs from deducting business expenses for tax purposes. The provision makes sense; companies that profit off dangerous, federally illegal drugs should not receive tax breaks.