It was recently announced that President Trump intends to finalize the Biden rule to move marijuana from Schedule I to Schedule III. Here’s what that means for you:
Marijuana is still federally illegal. Marijuana is not suddenly “legal” in your state. The same laws surrounding scheduled drugs still apply, including laws prohibiting marijuana from being transported on airplanes or across state lines. States that have defied federal law by legalizing marijuana are still defying federal law with marijuana in Schedule III. Marijuana is not available for prescription at your local pharmacy.
Why does rescheduling really matter? Schedule III substances are not subject to IRS Section 280E, meaning marijuana companies can deduct business expenses, drastically increasing their profit margins. This means more advertising, commercialization, and normalization.
This tax change is why we helped draft the No Deductions for Marijuana Businesses Act, legislation that would make any expenses related to marijuana businesses non-tax deductible regardless of marijuana’s schedule.
Please ask your Members of Congress to co-sponsor this important bill!
Drug scheduling in states often mirrors scheduling on the federal level, but your state can choose to keep marijuana in Schedule I. If your state does not have legal marijuana, you can ask your state lawmakers to keep marijuana in Schedule I in your state. Some states have “trigger laws” in place that will automatically align state drug scheduling with federal drug schedules unless something else is done.
Visit our state resource page to see what you can do to stop rescheduling in your state.
Here is what we are doing to respond to this announcement:
- We have retained former US Attorney General Bill Barr’s firm, Torridon Law, to sue the administration to stop this rule.
- We are announcing two campaigns to end marijuana sales and commercialization in Massachusetts and Maine. The Massachusetts campaign has already generated major media interest and the measure it proposes will soon face legislative review. Americans have had enough of legal marijuana, and they deserve a chance to vote on this policy again.
- We are asking Congress to pass the No Deductions for Marijuana Businesses Act, a bill we worked with Senators Pete Ricketts and James Lankford and Representative Jodey Arrington to release if marijuana were to be rescheduled. It prevents the industry from receiving the tax break associated with being classified as Schedule III.
- We are compiling and regularly updating our state resource page with recommendations and resources. This page is a resource to the country’s decision makers and advocates who are concerned about this ruling. It specifically provides support to the states with “trigger laws,” laws that require them to adjust their own regulation of marijuana depending on how it is federally scheduled.