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Canada To Stop Producing Pennies In 2013
First time accepted submitter master_kaos writes "Canada is going to stop producing pennies in February 2013 to help save the tax payers $11 million per year. Cash transactions will be rounded to the nearest nickel. Cheque/Credit Card transactions are not affected."
Late 80's, on european bases. Round up or down to the nearest 5 cent increment. Worked like a charm. The only place pennies were taken was the Post Office.
I have wondered for years how long it would take us Canadians to finally get rid of that awful piece of currency. Especially given that it takes more money to produce it than it is actually worth. No one can buy anything with pennies anymore and they really are nothing more than just metal wasting space. Plus, vending machines have never taken them which has made them even more useless than before.
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The Mint stopped making new pennies last May (http://www.cbc.ca/news/canada/manitoba/story/2012/05/04/mb-canada-last-penny-mint.html). But they are still in circulation. What happens on February 4th is the Mint stops putting pennies it gets back into circulation. What is unclear is when exactly stores will be required to stop giving pennies out.
Serve Gonk.
Did you miss the part where it said purchases would be rounded to the nearest nickle?
As a Canadian I can tell you that the pennies will disappear quickly, because the banks have been told to collect them.
The place I get my morning breakfast has already started rounding to the nearest nickle. My breakfast comes to $3.66 total, and I am always asked for $3.65
I for one, say "About bloody time!"
If I were God, wouldn't I protect my churches from acts of me?
There hasn't been any significant copper in a canadian penny since 1996.
94% steel, 1.5% nickel, 4.5% copper (as plating)
A big problem is that the penny is just useless. Nobody uses them, except maybe a handful of annoying old grannies who take 25 minutes to buy a cup of coffee.
So, they just get tossed into coin jars. Since they disappear from circulation almost immediately, and the government is (was) minting increasing amounts to make up for this. They don't get used either, just tossed into coin jars.
Those old copper pennies, from pre 1996, are worth ~2 cents, but the value of copper fluctuates pretty wildly.
The fact that there is such a thing as inflation is no shock to anybody, and not really a part of this story.
Neither. To the *nearest* 5 cent increment, be it up or down.
,1.01, 1.02 = $1.00
Let's assume the transaction is right around $1:
0.98, 0.99, 1.00
1.03, 1.04, 1.05, 1.06, 1.07 = $1.05
1.08, 1.09, 1.10, 1.11, 1.12 = $1.10
It ends up working pretty evenly.
Large stores will get a non taxable "profit" from raising to the nearest nickel, small ones probably will get some loss from raising to the lowest nickel.
How so? The entire transaction is rounded up or down, to the nearest nickel. If you buy more than one item, that screws the 1 or 2 cent price fixing scheme.
The US has pennies only because of lobbying from the zinc industry. The U.S. Mint pays $0.011 for a penny blank.
Yes, you're right, it costs 1.6 cents per penny.
citation: metro news
No, that is not right. Your own source specifies that 1.6 cents is the MANUFACTURING cost, not the price of the metal in the penny.
If the metal in the penny was worth more than the penny people would be melting them down, as they did with gold coins. Clearly that is not happening.
Sig Battery depleted. Reverting to safe mode.
There's nothing to stop them from doing that now... If the market will support it, they'll raise prices. Just like now...
Bad math in first post.
9.95 == 9.95
9.96 == 9.95
9.97 == 9.95
9.98 == 10.00
9.99 == 10.00
10.00 == 10.00
Sensible merchants would just use divisible-by-5 prices to avoid issues with rounding.
This doesn't always work. A common example where it doesn't work is grocery stores where certain items are sold by weight.
No, Advertised price at 9.96 would round down to 9.95. Then the price should increase to 10.05 or so, then jump to 10.95.
http://en.wikipedia.org/wiki/Psychological_pricing
What's a penny? What's a nickel? ;)
Here in Switzerland we have done away with them since a very very very long time ago. BTW a Swiss Franc is slightly worth more than a USD or CAD. I personally prefer it that way. Actually I prefer the debit transaction system we have. I can have a 100 CHF in my pockets and it will last me for about 1 to 2 months.
The one dollar bill of the US just confounds me.
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Damn straight! As an American expat in Canada, I truly truly hate returning to the states and getting a wallet full of ones. Having $1 and $2 coins makes money so much easier to deal with. I say let's go the next step now: throw out the nickel and quarter, and give us a $.50 piece.
I can't remember the last time I paid cash for gas in Canada. In fact, I think the only time in my life I paid cash for gasoline was in Florida when the pump wouldn't accept my Canadian credit card. I had to go in, give $50, buy my gas, and then go in again to get my change.
The reason the penny costs so much to keep in circulation is not solely the cost of minting. If a penny costs $0.02 to mint but is used in 10,000 transaction in it's life time that would be ok.
The problem with the penny is that they don't get spent. The mint needs to keep producing new ones for retailers to give out and people go home and throw them in a coffee can.
Oddly, this is the exact argument in favour of $1, $2, and $5 coins. People don't spend coins as easily, they tend fall between couch cushions or collect in jars. Until those jars are emptied, and the couch cleaned those coins are basically a kind of interest free loan the government.
I hate pennies .. they are evil and need to be banished from the earth. But Americans would scream blue murder if the gubmint tried to take their precious away.
But the funny/bizarre thing is that the US public has already been conditioned to rounding the bill through the use of the give/take-a-penny trays in innumerable stores across the country.
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In most cases rounding will go UP by a penny or four, because of the tendency to price things at xxx.99.
If and only if I buy only one item. I buy 3, all ending in 9, and the total transaction ends in 7. Therefore rounding down to the nearest nickel. Whee!! I screwed xCorp out of 2 cents!
This is an example of US government stupidity. All they have to do is stop making $1 bills. The rest will take care of itself.
In Canada the banks were told to collect $1 bills and turn them over to the mint. It took about a year for the $1 bill to disappear.
If I were God, wouldn't I protect my churches from acts of me?
The penny is just as pointless in the USA as it is in Canada. Of course, the USA is considerably behind Canada in recognizing the changes wrought by inflation. In addition to abolishing the penny, it should abolish the dollar bill and introduce a $2 coin as Canada did many years ago. (If you wanted to be really far-sighted, you could establish a plan for when to abolish the nickel and the $5 bill and introduce a $5 coin.)
Unfortunately, currency reform would not only face stiff opposition from the zinc lobby (because penny is largely zinc now), but from the politically well-connected Crane Company in Massachusetts, which manufactures all of the paper used in printing US currency. The absurdity of vending machines and tollbooths needing to accept paper money (much more expensive than coins) counts for nothing as against a corporation with skilled lobbyists.
I still can't fathom how posting "prices" that are different from what you actually pay may be considered a good idea.
It adds to customer confusion, cashier's work, and the benefit is... what? That it stresses how much the government gouges you for? That's not useful for anything but a political statement, and if so, it should note the credit card robbery as well.
The creatures outside looked from Alt-Right to Antifa; but already it was impossible to say which was which.
The higher denominations are always more likely to be spent though. If you have a jar of 1c coins vs a jar of $1 coins, a person is more likely to dip into the $1 jar than the 1c jar. Who wants to count out 1500c for a 6 pack of beer? I'd rather I with the 15 $1 coins.
As a side note, us Aussies got rid of our 1c & 2c coins years ago, hasn't hurt our economy, & our dollar is at US$1.05.
1. The Currency Act already has provisions for jokers like you. The penny is not legal tender for a payment of over 25 cents. Similar limitations are in place for all coins.
2. Worn? You're talking about a steel disc. Pennies don't wear out, they get considered worthless and tossed in jars (or worse, the trash) and more need to be made to maintain its availability for circulation.
upon the advice of my lawyer, i have no sig at this time
Australia got rid of 1 cent and 2 cent coins, and 5 cent coins are looking endangered. Nobody cares.
Retailers round the final total at the till, not the individual item prices, so unless you're just buying just one item your bill is just as likely to go down as up.(by a whole 2 cents maximum). Electronic transactions are not rounded.
We also replaced one dollar and two dollar notes with coins, again with no dramas.
1.03 this morning but I will assume you rounded to the nearest .05 as you Don't have Pennies.