Drug Enforcement Administration to Initiate Historic Shift in Federal Marijuana Policy

Cannabis industry advocates hail rescheduling as a significantly positive first step in the national effort to end prohibition and call on Congress to enact broader reforms

WASHINGTON, D.C. – Today, the Associated Press reported that the U.S. Drug Enforcement Administration (DEA) is planning to move cannabis from Schedule I status to Schedule III in the federal Controlled Substances Act. This historic move that acknowledges the medical benefits of cannabis products still needs to be reviewed by the White House Office of Management and Budget before the DEA initiates a public comment period.

Marijuana and its most well known psychoactive compound, THC, have been listed as Schedule I substances in the federal Controlled Substances Act since 1970, a designation reserved for drugs with high potential for abuse and no medical value. A move to Schedule III acknowledges the medicinal value of cannabis that has been known to the medical community and millions of patients using it under the care of their physicians for decades.

Rescheduling would not resolve the conflict that exists between federal law and the laws on the books in 38 states which have regulated the legal production and sale of cannabis for medical or adult use but a move to Schedule III would provide federal tax parity to state-legal cannabis businesses by allowing them to take deductions for ordinary expenses currently prohibited under a little-known provision of the federal tax code.

The cannabis industry widely agrees that rescheduling as a significant positive step but that broader federal reforms are needed to resolve the myriad issues plaguing the industry resulting from federal prohibition.

“Moving marijuana out of its absurd classification as a Schedule I drug is long overdue and we applaud the administration for finally acknowledging the therapeutic value that has been widely accepted by the medical community and millions of medical cannabis patients for decades,” said National Cannabis Industry Association CEO, Aaron Smith. “While this is undoubtedly a very positive first step, rescheduling will not end federal marijuana prohibition and doesn’t harmonize federal law with the laws allowing some form of legal cannabis in the vast majority of the states. In order for this move to be meaningful on the ground, we need clear enforcement guidelines issued to the DEA and FDA that would ensure the tens of thousands of state-licensed businesses responsibly serving cannabis to adults are not subject to sanctions or criminal prosecution under federal laws.”

“Further, it’s imperative that Congress build upon this development by passing comprehensive legislation to remove cannabis from the Controlled Substances Act and forge a new regulatory framework for whole plant cannabis products.” added Smith.

Just over half of Americans live in a state that has made cannabis legal for adults over 21 and three out of four Americans live in a state that has legalized cannabis for medical use. A November 2023 Gallup survey found that 70% of Americans support making cannabis legal for adults and a recent Pew Research Center poll found that less than 10% of Americans still support marijuana prohibition.

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The National Cannabis Industry Association (NCIA) is the largest cannabis trade association in the U.S. and the only national organization representing small and independent cannabis-related businesses. NCIA promotes the growth of a responsible, sustainable, and inclusive cannabis industry and works for a favorable social, economic, and regulatory environment for that industry throughout the United States.