All they really have to do is give people an incentive to roll up all those pennies they’re hoarding and get them back into circulation. That way, they could cut back on the number they mint and save some money. Give out free coin rolls (the shotgun type that only need to be crimped on one end) and maybe hand out some kind of prize for every Ten Dollars’ worth brought back. They’d save money in the long run, and the problem would be effectively solved.
The rounding would probably only happen with cash purchases. You wouldn’t even have to worry about it if you used a credit card. I almost never use cash anymore.
I remember reading an article (probably in MacLean’s) in the 80s that it cost 3 cents to manufacture 1 penny and this article, back then forecasted the elimination of the penny. Personally I would love to see pennies, nickels and dimes eliminated. Whatever price increase results from that would be less odious to me then the hassle of dealing with miniscule metal discs that I never use anyway unless I carefully plan a coffee purchase in advance.
Not going to happen, merchants will roll it up, you just wait and see, they are not going to let this extra cash get away, regardless of what the law says, and the government is going to look the other way.
That’s the only reason I’m against dropping the penny.
Look at what Ontario just did with that stupid “echo-fee”.
“Eco-fee”. It was a good idea (pay for disposal of something when you buy it), but it was introduced in a very hamhanded way. (Try to slip it in during another major tax change? Come on. You know better than that.)
And anyways, adding the eco-fee to a price wouldn’t change the mechanincs of rounding down or up for cash payment.
I disagree. Rounding up or down as necessary seems to work in other places that have dumped the penny. In Australia, for example, merchants do not always round up–I am unsure of what the law says, but I can tell you from experience that consumers certainly won’t let them round up if the total is to be rounded down.
Can’t wait. A friend of mine once witnessed a beggar toting up his take for the day, throwing all the pennies onto the ground! The coin is useless. Do I care if my $2.99 purchase now costs $3.
I was in Switzerland for six months in 1967. Theoretically, cents (centimes, rappen, whatever) still circulated. Some stores actually gave change to the cent, but most didn’t. I remember the dept. store Jelmoli did, but they were nearly unique. They had one and two cent coins and one cent was worth more than a US or Canadian penny today. By 1970, they had demonetized them and no one seemed to care. Many people I know never spend coins at all.
The smallest Australian coin is 5c. In the supermarkets, prices are not necessarily an integer multiple of 5 cents, but it doesn’t matter because items are not rounded individually. You add the entire bill and round that - so you are not paying an extra 2 cents per item from rounding. It makes total sense - sometimes your bill will be rounded down one or two cents, sometimes it will be rounded up. No big deal at all.
And satang coins (fraction of a Thai baht) are only good for merit making at your local temple.
Did you read the sentence I wrote immediately preceding what you quoted?
Emphasis added. I was stating why some people might be in favour of keeping the penny, not what I happen to think of it. As I said, I rarely use cash anyways, so I’m rather indifferent to the situation.
That certainly wasn’t the experience in Australia or New Zealand, both countries which have eliminated the 1 and 2c piece. NZ has also eliminated the 5c piece, too.
Retailers in Australia practice “Swedish Rounding”- 1 and 2 c rounds down, 3 and 4c rounds up to the nearest 5 c. Works out just fine and it really does even out in the long run.
The best approach is to avoid the “rounding” issue by abolishing not just the one-cent and five-cent denominations, but “cents” as a concept.
Set prices in dollars and dimes. Label the ten-cent and twenty-five-cent coins as “dimes” and “quarter dollars,” as they are in the U.S. and as Canadians already widely refer to them. Just forget “cents” entirely, and there is no rounding controversy. Nobody was worried before about the unfairness of prices being “rounded” to the cent, so if the smallest unit is the dime, nobody should have a problem with prices being “rounded” to the dime.
That only worked because we never had anything smaller. You can’t just take away a concept once you’ve introduced it.
And, anyways, with quarter-dollars (which won’t fit with your dimes scenario), you’re just making things really complicated. It would have to either drop to be a two-dime coin, or up to a half dollar.
Finland is not the only EMU country that eliminated the 1c and 2c pieces, Holland does not use them either and Holland also banned the cent when we still had the guilder, which worked fine for decades before we got the Euro. The weird paranoia about merchants rounding prices up and not down is completely misplaced in my opinion. Things that are 99 cents will be a dollar, but buy three and you get a nickel back. It’s a simple computer operation at the cash register. I hope Canada does get rid of the penny, it’ll tidy up my wallet!
But we have federal tax and provincial tax* and eco tax* to add onto most things, so the concept of the final price always ending up at a nice round figure is impossible.
- All provinces have different rates.
Concepts erode out of common awareness all the time when they’re little used. (Speaking generally here.)
I’m not aware of any particular reason that denominations need to be evenly divisible into one another, as long as the relationships are clear. Still, the reason for keeping quarters in this scenario would be their comfort level and ubiquity for coin-op machine uses, rather than the strict logic of their relationship to other denominations. Half-dollar coins, of course, are already available and would probably see better use in this scenario, along with dimes.
If “cents” are made obsolete, quarter-dollars will be just that: fractions of a larger unit and not multiples of a smaller. For that matter, we could abolish cents, as both denomination and concept, and then issue half-dimes–not five-cent pieces–as we once did in the U.S., and analogously to the half-cents that we also once issued. (I’m not advocating that at present.)
The point being that if the smallest unit is the dime, the smallest denomination should be no larger, but could be smaller. If the smallest unit is the cent, but the smallest cash denomination is larger, then there is a difference between cash and non-cash transactions, only the former necessarily rounded. Money should be conceptually the same whether it’s in cash or not.
I don’t understand why people always say this.
Look, how do you calculate taxes now? Don’t you somehow always end up with a nice round figure in cents coming up on the cash register?
Ah. I guess what you’re saying then is “have the cash register do the rounding for you.”
So, if something is sold at $5.25, it will be $5.51 in Alberta but rounded to $5.50, and $5.93 in Ontario but rounded to $5.90.
OK. I get it.
Either one would be great! Probably best to dump the dime instead of the quarter since so many machines are quarters only.
With all the coins gone, we can then dump the $1 bill in favor of a coin.
But merchants do not round down at all. You just think they do
For example suppose the item should sell for, WITH TAX, 1.87 cents. The merchant says I’ll have to round it up to 1.90. That’s bad for business. So he sets the base price a few pennies higher now, WITH TAX, the price comes to 1.91. He round down.
So the customer SWEARS the merchant DOES ROUND DOWN. But in reality he didn’t round down at all.
If you only buy one item at a time that would be true, but the rounding is done on the final sum of your purchase. So it would be almost impossible for a merchant to set prices where the rounding will consistently favor him. They’ll still prefer to trick you with X.99 style prices rather than cheat you on the rounding.