The Department of Justice signed an order related to the reclassification of state-licensed medical marijuana.
In the reclassification, officials labeled it as a less dangerous drug. This move marks a significant shift in federal cannabis policy in decades.
Attorney General Todd Blanche reclassified legal medical marijuana from Schedule I (the most restrictive, which includes drugs like heroin and ecstasy) to Schedule III, which includes prescription drugs like ketamine and Tylenol with codeine.
While this order does not legalize the recreational use of marijuana at the federal level, it provides a huge tax break to those who legally sell medical marijuana.
Blanche wrote on
The announcement came after President Donald Trump issued an executive order to the Department of Justice to speed up the reclassification process.
For medical marijuana companies, the immediate change is related to taxes.
However, because marijuana was previously classified as Schedule I, the deduction of regular business expenses such as rent, salaries or advertising by the business was prohibited under the Internal Revenue Service’s Section 280E guidelines. This caused the effective corporate tax rate to rise to 70 percent or more.
At the same time, companies can attract more investors, obtain loans and easily access traditional banking services.
Patients, on the other hand, won’t see direct changes to access or prices right away.
