President Donald Trump has signed an executive order to expedite a historic change in how the federal government views marijuana.

Trump ordered the U.S. Justice Department to hasten a recategorization of marijuana from a Schedule I drug under the 1971 Controlled Substances Act to Schedule III. No longer would marijuana sit with heroin and LSD as a drug with a high potential for abuse and no official medical use, instead moving into the ranks of drugs like Tylenol with codeine and other widely prescribed drugs.

The rescheduling won’t make marijuana legal nationwide, nor will it mean companies can ship marijuana across state lines or immediately access normal banking services like other businesses. One potential benefit for consumers is the use of debit and credit cards for marijuana purchases, though many dispensaries already take debit cards.

The order noted that “decades of Federal drug control policy have neglected marijuana’s medical uses,” which has limited research, and that the U.S. Food and Drug Administration and National Institute on Drug Abuse have recommended the change.

“The Federal Government’s long delay in recognizing the medical use of marijuana does not serve the Americans who report health benefits from the medical use of marijuana to ease chronic pain and other various medically recognized ailments,” the order stated.

The order also brings a softening on a new law affecting cannabidiol, commonly known as CBD, including allowing reimbursement for purchases of CBD products for Medicare beneficiaries. This would allow the Americans “to benefit from access to appropriate full-spectrum CBD products,” the order stated.

Full-spectrum CBD products don’t include hemp products with levels of THC that would get consumers of them high. Trump and Congress closed a loophole last month that legalized the high-THC products nationally, though it won’t take effect for a year.

Dr. Mehmet Oz, Trump’s administrator for the Centers for Medicare & Medicaid Services, said at the rescheduling-order signing that CBD reimbursement would take place beginning in April.

The biggest change, experts say, would be in the removal of a tax law called 280E that applies only to Schedule I drugs, massively reducing the tax burden for marijuana companies. The 280E law disallows the companies from deducting normal business expenses, like employee payroll and capital expenses, from their tax requirements.

Because of it, some pay effective tax rates of 50% to 70% according to cannabis attorney Jason Adelstone, who’s written articles on the subject.

The removal of 280E is essentially “the only benefit that state legal operators will see” from rescheduling, said Adelstone, who’s based in Colorado but is licensed to work in Arizona, where he previously lived.

The change would result in a “massive benefit” for many dispensary companies that would save them millions of dollars in tax payments, he said.

That could bring ancillary benefits, such as lower prices for products due to the savings realized by dispensaries. It will also bring more investment opportunities for companies, Adelstone said, because investors would in theory have fewer qualms about dealing with companies that aren’t selling Schedule 1 drugs.

Raul Molina, owner of Mint Cannabis, a multistate company that has eight stores in Arizona, said the U.S Food and Drug Administration is expected to get more involved in marijuana sales once the drug moves to Schedule III.

“We can’t make any official claims right now” about the health effects of cannabis, he said, but that could change under Schedule III.

For instance, a brand could label a product “sleep gummies,” but can’t officially state the products would help people sleep. But Molina said he worries the FDA would also want more oversight of products including marijuana edibles, which may not always be good for companies or consumers.

Others in the industry herald the rescheduling as a sea change in how Americans view marijuana, combined with legal changes that benefit companies and consumers.

“We’re grateful to President Trump for recognizing the overwhelming majority of Americans who support cannabis rescheduling, opening the door to federal

reform, medical research, and normalization for an industry that employs hundreds of thousands of professionals and contributes billions of dollars in taxes and economic activity every year,” said George Archos, Verano founder and CEO, the company behind brands like MÜV and Savvy.

Change will take more time, has some opposition

Rescheduling won’t happen immediately despite Trump’s order. It still has to go through a rulemaking process by the U.S. Drug Enforcement Administration that had already begun before the order.

Laura Bianchi and Justin Brandt, Arizona business attorneys who specialize in marijuana, told The Arizona Republic it may take months before the change takes place.

“We’ll see how the DEA responds,” Brandt said, adding he expects it to happen sometime before the end of 2026.

How banks will change their policies also remains to be seen, Bianchi said. People in the financial industry will have fewer concerns and a lessened perception of risk once rescheduling takes place, and that’s likely to have a “domino effect” on policies, she said.

That could lead to widespread consumer use of debit cards and ultimately the use of credit cards for purchase of cannabis products, ending the need for cash purchases that have resulted in robberies and don’t allow customers to collect credit card benefits like frequent-flyer miles when they buy marijuana.

Congress would still have to pass something like the SAFER Banking Act to normalize banking services for cannabis companies, Bianchi and Brandt said. Currently, proceeds from state-sanctioned marijuana companies are considered unlawful due to the lack of federal legalization.

The 2023 SAFER Act, a proposed law co-sponsored by former U.S. Sen. Kyrsten Sinema that has yet to pass, would disallow banking regulators from penalizing banks for accepting the companies as clients or demanding they disassociate from them.

Earlier this week, Trump said the reclassification would lead to “tremendous amounts of research” that isn’t happening now. But experts said that’s also still up in the air and relies on perceptions more than an automatic change due to the rescheduling.

Trump signed his order even as 24 Republicans in Congress, including Arizona Rep. Paul Gosar, sent him a signed letter opposing the change. The letter referred to concerns by the National Transportation Safety Board, which told the DEA last year the rescheduling “would immediately prohibit continued testing of safety-sensitive transportation employees for marijuana use” because federal guidelines currently don’t authorize testing for Schedule III substances.