The US government appears poised to announce next year the most sweeping changes in decades to how it handles marijuana, the psychoactive drug dozens of states allow to be sold from storefronts, but which federal law considers among the most dangerous substances.
Evidence suggests that Joe Biden’s administration, responding to a policy the president announced last year, is working on moving marijuana to schedule III of the Controlled Substance Act (CSA), a change from its current listing on the maximally restrictive schedule I. That would lessen the tax burden on businesses selling the drug in states where it is legal, and potentially change how police agencies view enforcement of marijuana laws.
“If it’s going to be finalized at schedule III, it’s going to be the moment that the industry really is able to turn the corner and we begin to see the growth in the cannabis space amongst the legal operators that we’ve been waiting on for so long,” said David Culver, senior vice-president of public affairs for the US Cannabis Council, a trade group.
But other marijuana legalization advocates regard changing its classification as a half-measure that would do nothing to resolve conflicts between state and federal laws that emerged after weed legalization picked up speed a decade ago.
Marijuana faces the same federal restrictions as drugs like heroin and ecstasy under the Controlled Substances Act (CSA), but 38 states have approved its use for medical conditions, and 24 states and the District of Columbia allow adults to also consume it recreationally. That conflict has complicated the marijuana industry in states where it is legal, particularly when it comes to access to banking services, and Paul Armentano, deputy director of the National Organization for the Reform of Marijuana Laws (Norml), said rescheduling the drug would not resolve that.
“Classifying it as schedule III would make every existing state cannabis law that’s currently inconsistent with federal law as equally inconsistent going forward. So, it doesn’t solve any of the problems before it,” he told the Guardian.
“It needs to be descheduled for logistical reasons, for practical reasons, because we have a system right now where the majority of states are choosing to regulate marijuana as a legal commodity through their own state-specific systems, and that act is not permitted for any substance that is in the CSA. That is only permitted for substances that are not scheduled.”
Last month, Gallup released a survey that found 70% of Americans think marijuana use should be legal, a record number.
Biden does not appear ready to go that far. In his statement announcing marijuana reform, which was released about a month before last year’s midterm elections, the president pardoned all people convicted of simple marijuana possession federally, and also kicked off the review of the drug’s classification under the CSA.
That process is typically a bureaucratic affair, in which the Department of Health and Human Services reviews the substance and sends its findings to the Drug Enforcement Administration (DEA), which then decides whether to change its classification. Yet signs have already emerged that marijuana is being treated like no drug before it.
On 30 August, the US health and human services secretary, Xavier Becerra, announced on X that his department had completed its review, an unusual public status update for a process that is typically opaque. And his account made the post at 4.20pm, a number of great significance in cannabis culture.
Becerra did not specify what his department had recommended, but Bloomberg News obtained a letter from HHS to the DEA that recommended marijuana be put on schedule III, alongside drugs like ketamine and anabolic steroids.
Tahir Johnson, a board member at Minority Cannabis Business Association who is planning to open a dispensary in New Jersey next month, said rescheduling would help his business by lessening its tax burden. Federal law currently prohibits marijuana businesses from deducting their expenses from their income, meaning they sometimes pay tax rates upwards of 80%.
“It will help all cannabis businesses. But, I think especially for minority businesses, where capital and finances are tight, being able to alleviate that is certainly meaningful,” said Johnson.
Armentano also expects a rescheduling could help Biden’s reputation with the voters who make up the Democratic coalition, as well as people outside his base. Gallup found 87% of Democrats think marijuana should be legal, along with 55% of Republicans and 64% of people older than 55.
“It behooves the president to have this core base passionate about something that he’s doing to try to address the enthusiasm gap that he seems to have now,” he said.
Kevin Sabet, president of Smart Approaches to Marijuana, which opposes legalizing the drug, argued dropping pot to a lower CSA schedule would harm public health.
“It’s going to ramp up commercialization, it’s going to ramp up the marketing and the glamorization of marijuana,” Sabet said. “It’s going to do that both in a practical way with this deducting expenses, and it’s going to do so in a global way, by just sending the message that this is harmless.”
Until marijuana is legalized federally, it will still be up to Congress to resolve the conflicts between state and federal law, and progress there has been slow. A bill to allow cannabis businesses access to more financial services, known as the Safer Banking Act, has been passed by the House of Representatives six times, and is currently working its way through the Senate.
Starting in 1972, groups including Norml have petitioned the DEA and HHS to reschedule marijuana, to no avail. Armentano said the stage appears to be set for political considerations to finally get federal agencies to back down, at least partially.
“Frankly, if this petition is successful, and the DEA reverses 50 years of precedent, then it just speaks to the fact that all along this process has simply been a political one,” he said.
