Illinois marijuana firms will get a massive tax break from Trump administration's historic weed shift

Chicago Sun-Times — Apr 23, 23:00 PM

An employee shows off some flower at Zen Leaf Dispensary at 222 S Halsted St at Greektown, Thursday, April 23, 2026.</p><p>Trump’s acting AG signed an order reclassifying state-licensed medical marijuana as a Schedule III drug, giving medical marijuana operators a tax break and lowering the barrier to more research. https://cst.brightspotcdn.com/dims4/default/2b3a9b8/2147483647/strip/true/crop/6122x4083+0+0/resize/840x560!/quality/90/?url=https%3A%2F%2Fchorus-production-cst-web.s3.us-east-1.amazonaws.com%2Fbrightspot%2F99%2F43%2Fd3e7cc724d389528b5d67decb3d0%2Fweedscheduleiii-260424-04.JPG" />

The Trump administration's reclassification of medical marijuana will offer some Illinois weed firms a massive tax break, but industry leaders say more action is needed for comprehensive reform.

Acting U.S. Attorney General Todd Blanche signed an order that shifts state-licensed medical cannabis from a Schedule I — meant for drugs without medical use and a high potential for abuse — to the more loosely regulated Schedule III. It also applies to cannabis products approved by the U.S. Food and Drug Administration.

The policy shift offers medical marijuana operators significant tax relief by allowing companies to deduct business expenses on their federal taxes.

It also lowers the barrier for more cannabis research.

George Archos, founder and CEO of Verano, which operates 10 Zen Leaf dispensaries in the Chicago area and several more in the Midwest and Florida, said the company would save an estimated $80 million a year from the tax break.

“We could invest back into our operations, putting us on a level playing field with any other legal business,” Archos said.

Recreational cannabis remains a Schedule I drug, but Blanche’s order sets up an expedited Drug Enforcement Administration hearing process beginning June 29 to consider broader reclassification to Schedule III.

Rescheduling medical cannabis is a “long-overdue step that finally brings federal policy closer to the science,” said Charlie Bachtell, CEO of Cresco Labs, which operates 10 Sunnyside dispensaries in Illinois.

“This decision opens the door to expanded research, better data, more informed care, and broader access for those who need it most,” Bachtell said in a statement. “It is a win for all patients nationwide and will usher in a new era of healthcare, where cannabis is treated like any other medicine.”

The differing classifications for the same substance breaks a longstanding stance in the Controlled Substances Act, said Mike Feldman, general counsel for Nabis, the largest cannabis distributor in the U.S.

“[The order] creates a regime where the same product, in the same packaging, is federally Schedule III or Schedule I, depending on where it is purchased,” Feldman said. “That has never been how drug schedules work, for opioids, for psychedelics, for anything."

An employee hands a customer their order at Zen Leaf Dispensary at 222 S Halsted St at Greektown, Thursday, April 23, 2026.
Trump’s acting AG signed an order reclassifying state-licensed medical marijuana as a Schedule III drug, giving medical marijuana operators a tax break and lowering the barrier to more research.

But even reclassifying all types of cannabis isn’t going far enough to reform cannabis laws, said Betty Aldworth, chair of the Marijuana Policy Project.

“It does not resolve the fundamental contradictions between federal and state law.

It does not address the ongoing reality of cash-only operations that put workers and communities at risk.

It does not protect people from the legal consequences of cannabis use embedded in housing, immigration, employment, or family law,” Aldworth said in a statement.

“And it does not create a pathway for patients to access cannabis through insurance coverage, even when it may be safer or more effective than legal options.”

Kevin Sabet, president of Smart Approaches to Marijuana, which has been opposed to cannabis reclassification and legalization, called Blanche’s order an “injustice to the American people of unprecedented proportions” because of the massive tax breaks.

He argued the move does nothing for cannabis research.

“What we would need for research is funding… And funding is not in any of these orders,” Sabet said.

He said the reclassification without further research reminds him of Big Tobacco putting profits over public health.

“It’s a massive industry that relies on addiction for profit and that’s what my worry is if we allow this to happen,” Sabet said.

All cannabis use remains federally illegal, though 24 states plus Washington D.C. have legalized adult recreational marijuana use, 40 allow medical marijuana use, and eight others allow low-THC cannabis or CBD oil for medical use.

Only Idaho and Kansas ban marijuana outright.

Illinois has around 50,000 monthly medical marijuana patients, which is down from more than 70,000 in 2021 but is roughly the same as when the state legalized recreational use in 2020, state data shows.

The state collected $13 million in medical marijuana sales in February, down from $20 million at the same time last year and from its high of around $35 million collected monthly in 2021, according to state data.

Illinois sold $105 million in recreational cannabis in February.

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Trump administration reclassifies medical marijuana