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Is It Time To Kill The Penny?

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 Posted 07/15/2020  1:12 pm  Show Profile   Bookmark this reply Add jbuck to your friends list Get a Link to this Reply

Quote:
Sure, retailers could just round off. But that ignores sales taxes. At 6% here in PA, a $1.25 item has 7.5 (8) cents sales tax. The state is not going to give up those 2.5 cents, and I don't want to pay any more taxes than I have to.
You are viewing sales tax like it is collected as cents added to each item price when it is collected as a percent of the entire purchase total (not on each individual item).

We used to have an 8.5% sales tax down here (since raised to 9%) and it worked out just fine without a Half Cent coin.


Quote:
And I can pretty much guarantee that retailers will round UP, not down.
That is just not true. It is not true in Canada, it would not be true here. Take care of your customers or someone else will. If a store rounds everything up, their competitors will round everything down.

As a retailer, rounding all cash sales down makes sense because they are not paying the processing fees from electronic purchases.
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 Posted 07/15/2020  7:29 pm  Show Profile   Bookmark this reply Add fortcollins to your friends list Get a Link to this Reply
Spot on.

EDIT: For some perspective on curbing street drug dealing by replacing currency with heavy coins, consider how much one million dollars (and a more manageable sum of ten thousand dollars) weighs in various forms:

$100 bills
$1,000,000 in $100 bills weighs roughly 22 pounds.
$10,000 in $100 bills only weighs 3.5 ounces

$20 bills
$1,000,000 in $20 bills weighs roughly 110 pounds.
$10,000 in $20 bills weighs just over a pound (17.6 ounces)

Hypothetical $20 coin weighing the same as a classic Morgan or Peace dollars (26.73g/coin)
$1,000,000 (50,000 coins) = 2,946 pounds
$10,000 (500 coins) = roughly 29 pounds

Hypothetical $5 coin weighing the same as a current CNC half dollar (11.34g/coin):
$1,000,000 (200,000 coins) = roughly 5,000 pounds
$10,000 (2,000 coins) = roughly 50 pounds

Would rather get chased down a street carrying a pound of paper or hauling at least 29 pounds of metal?
Edited by fortcollins
07/15/2020 8:03 pm
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 Posted 07/15/2020  7:38 pm  Show Profile   Bookmark this reply Add Ericwats to your friends list Get a Link to this Reply
Bring back the 3 cent pieces!
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 Posted 07/15/2020  7:50 pm  Show Profile   Bookmark this reply Add Joe2007 to your friends list Get a Link to this Reply
Honestly at this point I doubt that many people would even notice let alone protest the elimination of the cent. I'd even be in favor of eliminating the nickel at the same time. Keep dimes and quarters and bring back halves and dollar coins.
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 Posted 07/16/2020  1:17 pm  Show Profile   Bookmark this reply Add nick10 to your friends list Get a Link to this Reply
No nickels means inability to round to the nearest 5 cents, of course. I'd ditch dimes too and round to the nearest quarter.
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 Posted 07/16/2020  1:37 pm  Show Profile   Bookmark this reply Add ijn1944 to your friends list Get a Link to this Reply
Bring back bartering--ducks, goats, potatoes, etc. Keep a weather eye out for doubled duck bills.
Edited by ijn1944
07/16/2020 1:43 pm
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 Posted 07/16/2020  1:52 pm  Show Profile   Bookmark this reply Add jbuck to your friends list Get a Link to this Reply

Quote:
No nickels means inability to round to the nearest 5 cents, of course. I'd ditch dimes too and round to the nearest quarter.
True. Having no nickel makes it difficult to round to the dime with quarters. Of course, we could just ditch the quarter and bring back the doubledime.
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 Posted 07/16/2020  2:39 pm  Show Profile   Bookmark this reply Add atticguy to your friends list Get a Link to this Reply
With what is going on today, it seems that the penny has already been killed, along with nickels, dimes, and quarters. The Kennedy halves and dollar coins have been dead here in the USA for over twenty years now.

There are only a few places where I can use any type of coinage right now.
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 Posted 07/16/2020  3:03 pm  Show Profile   Bookmark this reply Add Conder101 to your friends list Get a Link to this Reply

Quote:
Sure, retailers could just round off. But that ignores sales taxes. At 6% here in PA, a $1.25 item has 7.5 (8) cents sales tax. The state is not going to give up those 2.5 cents, and I don't want to pay any more taxes than I have to.

Yep you buy 1 the state loses 2.5 cents. You buy two of them it breaks even. You buy three it comes to $3.975 cent which rounds up to $4 and the state gets and extra 2.5 cents.

The argument that merchants will round up or that the state will collect extra sales tax only works if no ever buys more than one item at a time. When buying multiple items since the rounding is applied after the purchases are totaled and the tax applied roughly 50% of the time it will round up, and 50% of the time it will round down with the net change in the amount of tax being collected is zero. And since the rounding is applied after the tax is applied there is no need to round prices up or down and can be left at odd amounts if you choose. The only excuse to round the prices up is to pad your own pocket. And as mentioned due to competition, if someone does he runs the risk of his competitors keeping their the same or rounding down and eating into their customer base. It will soon be known that prices at merchant B (keeps the same or rounds down) are cheaper than at Merchant A (rounds up to pad his pockets) and customers start going to merchant B.
Gary Schmidt
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 Posted 07/30/2020  08:46 am  Show Profile   Bookmark this reply Add jbuck to your friends list Get a Link to this Reply
Another article...

Will the Penny Survive Coronavirus? Some Hope Not


Quote:
Coins in circulation have become scarcer because fewer people are using them during the pandemic, renewing a debate over whether pennies have outlived their usefulness.

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 Posted 07/30/2020  12:13 pm  Show Profile   Bookmark this reply Add just carl to your friends list Get a Link to this Reply
No. We must have something for when we buy something for 2 Cents and use a Nickel.
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 Posted 07/30/2020  12:25 pm  Show Profile   Bookmark this reply Add jbuck to your friends list Get a Link to this Reply

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No. We must have something for when we buy something for 2 Cents and use a Nickel.
1943 called. It wants its comment back.
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 Posted 08/13/2020  12:41 am  Show Profile   Bookmark this reply Add numismagic to your friends list Get a Link to this Reply
There is no sound reason to keep making cents, but there are two good reasons to get rid of it. There is nothing worth having that a penny would buy today and each one costs more to mint than its face value. For those folks unwilling to part with Abe we could simply get rid of FDR and put him on the dime instead. I guess it doesn't matter what we think anyway because DC is going to keep making the coins anyway.
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 Posted 08/13/2020  9:00 pm  Show Profile   Bookmark this reply Add Lack of faith to your friends list Get a Link to this Reply
Only if you want a cashless society.
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