Rescheduling won’t allow interstate commerce, federal legalization or an instant federal regulatory takeover. But it will give Missouri marijuana companies some tax relief
BY: REBECCA RIVAS
Missouri Independent
President Donald Trump’s executive order to reschedule marijuana won’t change much in terms of how Missouri’s marijuana industry operates, business owners and legal experts agree.
It doesn’t change the fact that marijuana can’t be transported or sold across state lines. It doesn’t do away with the cap on the number of business licenses to cultivate and sell marijuana in Missouri.
And it doesn’t allow customers to use credit cards at dispensaries, since credit card networks and issuing banks are still governed by institutional risk frameworks that prohibit cannabis transactions.
But the order will give Missouri marijuana companies some tax relief and long-awaited recognition for the medicinal benefits their products can offer, said Mark Hendren, president of Flora Farms cannabis company that operates 12 dispensaries in Missouri.
“Obviously for a cannabis company like us, the big impact is allowing us to pay our taxes and run our businesses just like all other legal businesses,” Hendren said.
Right now, marijuana companies can’t deduct many business expenses from their taxes, including rent, travel, advertising and most professional services.
“Frankly, it’s a testament to the resilience of the industry that they’ve been able to be a profitable model, even without 280E tax deductions,” said Craig Small, a Denver-based cannabis attorney. “But with this coming change, certainly that might immediately increase profits by about 30%.”
Trump’s order moves cannabis from Schedule I to Schedule III on the Federal Drug Administration’s list of controlled substances. Schedule I, the most restrictive category under federal law, indicates a high likelihood of abuse and no accepted medical value.
Trump said the move reflected that cannabis could have medicinal value, even if abuse was still possible.
The rescheduling process is predicted to take place during 2026, Small said, but the timeline is still unclear.
Nicholas Rinella, CEO of Hippos cannabis company, said it’s encouraging to see cannabis operators moving closer to being “treated like every other legitimate business.”
“That shift allows us to reinvest into our operations, scale responsibly and continue delivering world-class products,” Rinella said. “It’s also meaningful to see the federal government begin to align with public sentiment in recognizing the real societal benefits of cannabis.”
Andrew Mullins, executive director of the Missouri Cannabis Trade Association, said rescheduling properly recognizes cannabis as medicine and allows for greater research of marijuana.
Mullins pointed out that marijuana has been listed as a Schedule I drug since 1970, along with heroin, LSD and ecstasy because the federal government previously determined that there were no currently accepted medical uses for cannabis.
“Federal rescheduling of cannabis removes barriers and creates opportunity for the 40 U.S. states, including Missouri, that have legalized medical and/or adult-use cannabis,” he said. “And no other state in the country is as well positioned as Missouri to take advantage of this reform.
Mullins said Missouri’s cannabis industry has been called one of the most successful in the entire country.
Since Missouri’s first legal medical marijuana sale in 2020, he said Missouri has surpassed $4.5 billion in total cannabis sales. In 2024 alone, the Missouri cannabis industry generated $244.93 million in sales tax revenue for state and local governments.
Hippos recently launched the state’s first THC oral spray, and the timing couldn’t be better for innovation in the space, Rinella said.
Cannabis prohibition, he said, represents a relatively short chapter in human history, and the country is “approaching a point where history corrects itself.”
“Forty years from now, my grandkids will probably have a harder time understanding that I grew up in an era when cannabis was federally prohibited,” Rinella said, “than they will understanding that I grew up before the internet existed.”