The Death of the Penny?

The penny, an old Canadian tradition, may become history soon enough. 2008 celebrates the 100th birthday of this copper coloured coin and some people believe that it may be the last. This past spring NDP MP Pat Martin introduced legislation to stop the production of the penny and phase it out of circulation around the country. Many people see the penny as both an environmental waste, a waste of money, and a waste of time for both consumers and merchants.

To produce pennies each year costs Canada about $130 million. As we all know from personal experience, most of the pennies which are circulated are a waste of time. There are about 20 billion pennies around the world today. They generally end up as loose, unused change in our pockets or wallets or in a piggy bank which rarely gets emptied.

In replacement of the penny it has been proposed that a rounding system would come into place. This would not be applicable to debit or credit card purchases, only for cash. Purchases would be rounded to the nearest nickel instead of charging mere cents. For example if you bought a coffee that was $1.52 you would only pay $1.50 and if it was $1.53 you would owe $1.55. The rounding will take effect after the total purchase price, taxes included.

Although there is currently one reported coffee shop that has already put the rounding system into play, some people are concerned that this system will favor the companies’ revenue. Some people suggest that companies will decide to round each purchase up, therefore making a bigger profit and cheating their customers out of money. True enough, but if your change would have been mere pennies, the chances are that it’s not going to break your bank.

The bill that NDP Pat Martin has proposed is modeled after other countries such as New Zealand and Australia. They have already eliminated their lowest currency and reported no problems with the change. Recent polls show that most Canadians are in fact in favor of this new proposal.