Trump Rescheduling Order Sends Shockwaves Through Colorado’s Struggling Cannabis, CBD Markets

With the shine of being first to market long gone, Colorado’s cannabis sector welcomed today’s news that President Donald Trump had issued an executive order to reclassify cannabis from a Schedule I drug to Schedule III.

While wholesale cannabis prices have never lower in Colorado, according to the state Department of Revenue, dispensary sales have consistently declined for over five years now. Trump’s executive order won’t magically fix that, but the ramifications could help cannabis business owners find more willing financial partners and loosen federal tax regulations.

Cannabis industry attorneys believe that a Schedule III designation will free state-licensed marijuana businesses from an IRS tax code that forces plant-touching businesses to pay tax rates of up to 70 percent. According to Chuck Smith, CEO of cannabis trade group Colorado Leads, the move is a “big step,” but still leaves plenty to be desired.

“While rescheduling alone will not resolve all the challenges created by conflicting state and federal laws, it is an important development that is long overdue. Reclassifying cannabis under Schedule III will alleviate the unfair federal tax burden and lack of access to banking and financial services that cannabis businesses have shouldered for years,” Smith says. “State-legal cannabis businesses that create jobs, pay taxes, and provide adults and medical patients with safe and legal access to cannabis deserve to be treated fairly, and this would be a big step in that direction. When it comes to addressing the wide range of criminal justice implications associated with prohibition, Schedule III does not go nearly far enough, but it will help pave the way for those important reforms.”

Smith hopes that the cannabis industry in Colorado, home to the oldest state recreational program in the country, can be a “constructive partner as federal agencies consider next steps.” As with many Trump executive orders, though, questions linger about how and when the plant will be rescheduled and whether anyone will try to fight that order in federal court, where many of the president’s executive orders have ended up.

What’s Next?

And what will those next steps be? The president has officially ordered Attorney General Pam Bondi to “take all necessary steps to complete the rulemaking process related to rescheduling marijuana to Schedule III” in the Controlled Substances Act, which should push the DEA to get in line. However, some members of Congress are upset with the decision, as are groups and lobbies fighting the advancement of cannabis legalization.

“By lowering marijuana’s federal classification, the government sends a dangerous signal to young people that today’s marijuana is safe. In reality, today’s products are riskier than ever, and the long-term consequences of broader access remain highly problematic. These industry benefits are being granted without first establishing potency caps, serving-size limits, or youth protections,” says One Chance to Grow Up, a group that pushes for cannabis guardrails and against commercialization in the name of youth protection. “We urge leaders at every level of government to take responsibility for protecting children. Federal scheduling does not eliminate the need for stronger product safeguards and safety measures.”

Hemp, CBD Get New Life

To make things slightly more confusing, the majority of Trump’s order focuses on CBD and full-spectrum hemp products, many of which are set to be outlawed by Congress. That ban, added to a budget bill to reopen the federal government in November, was created to stop the growing amount of hemp-derived THC products for sale online and at non-licensed retailers; it prohibits the sale of any product with more than 0.4 percent THC in its packaging.

Trump’s order signals that some changes may be coming to the looming hemp ban, as it directs the White House to “work with Congress to update the statutory definition of final hemp-derived cannabinoid products to allow Americans to benefit from access to appropriate full-spectrum CBD products.” The order, however, directs those updates to preserve “Congress’s intent to restrict the sale of products that pose serious health risks.”

On top of the executive order, the Centers for Medicare & Medicaid Services is pursuing an initiative that will allow Medicare and Medicaid patients to receive approved CBD treatments under their coverage plans.

There are some fears among activists and state-licensed medical marijuana businesses that moving to Schedule III and adding CBD to federally-run health care could push the plant further into the hands of big pharmaceutical companies. Still, many advocates and people working with patients celebrate the move as a door to increasedaccess.

Realm of Caring executive director Sasha Kalcheff-Korn works with medical marijuana patients and their families to educate them on cannabis-infused treatments while providing pathways to procure their required medications, which are often expensive and, in some states, illegal.

“For decades, cannabinoid therapies have existed in a regulatory gray area while millions of Americans rely on them to manage pain, sleep issues, anxiety, and inflammation. The Trump administration’s decision to reschedule cannabis to Schedule III is an acknowledgement of the therapeutic potential of the plant that Realm of Caring and other organizations have worked so consistently to demonstrate. This move will open a door that has been closed for far too long by making it possible to pave a clear, science-driven regulatory pathway that establishes federal standards for manufacturing, testing, labeling, and consumer safety; guardrails that have never existed but are desperately needed,” Kalcheff-Korn says.

Kalcheff-Korn looks forward to the prospect of more research, which she argues has received “limited support” from the government and research institutions.

“Today represents a significant milestone for our industry and our organization’s mission, and we look forward to continuing our role in connecting patients with guidance and clarity on the benefits of cannabinoid therapies,” she says.

Colorado CBD Products Announced for Seniors

At least one Colorado CBD company is already pouncing on the news. According to Charlotte’s Web, a Louisville-based hemp and CBD company that rose to prominence by working with Realm of Caring to provide CBD-heavy medication for epilepsy patients, the company will “participate as a CBD provider supporting the treatment of senior oncology patients” under the new Medicare and Medicaid coverage programs.

“For the first time, seniors living with cancer will gain access to science-backed CBD products with reimbursement through Medicare and Medicaid, creating a new model of care that prioritizes personalization, accessibility, and affordability,” its announcement reads. According to Charlotte’s Web, seniors will be able to access the products through an online health care portal in early 2026.