Do you favor the continued minting of US One Cent coins?

What is breakage? – Here is an example. You purchase an item that cost $1.00 plus 6% sales tax for a total of $1.06; but there is a problem – cents do not exist anymore. So now the transaction has to be rounded up to $1.10 which produces 4 cents breakage. Breakage wouldn’t be limited to only sales transactions – it would affect 80% of all transactions (mortgage payments, credit card payments, payroll checks, etc.). Do you really believe government is going to pass on the opportunity of collecting 40 million dollars a day in breakage? As for the ½ cent argument – well there weren’t as many cash registers, payroll systems, loan amortization systems and the like based on computer technology which required a software or hardware fix in those bygone days.

Just my thoughts and reasoning.

 

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An item costs 99 Cents and there's 4% tax making a total cost of $1.03.
But there's a problem - cents don't exist anymore. So now the transaction has to be rounded down to $1. In the long run the rounding up and the rounding down produce a zero gain/zero loss or near zero loss as my example shows.

PS to Peter: why is there no Devil's Advocate emoticon available?

 

Quoted from above

"An item costs 99 Cents and there's 4% tax making a total cost of $1.03.
But there's a problem - cents don't exist anymore. So now the transaction has to be rounded down to $1. In the long run the rounding up and the rounding down produce a zero gain/zero loss or near zero loss as my example shows."


But there is a problem - cents don't exist anymore. 4 cents in sales tax - state can't collect that and they certainly will not settle for nothing. No all transactions will be rounded up - just the same as it is now on partial cents.

 

So what? What did they due all those years when a Cent was worth nearly a dime. They rounded.

Ruben

 

aside which sales tax is 8.5% in New York and nothing costs 99 cents.

 

The question at hand is whether the cent should be done away with. I am of the opinion that it shouldn't. On the surface the idea sounds OK but when you look underneath there is more cost associated with this action than a person might realize. Probably significantly more than the US Mint would save by discontinuing production.

 

there is no cost.

 

HAHAHAHAHA.....love that post! People today are just over-medicated zombies due to their fear of everything. Relax, enjoy life, play with a little mercury in your hands....IT'S FUN...most of us did it and guess what....WE'RE STILL ALIVE!

 

Ruben- no costs? I think there is a cost to consuner's/business owner's in terms of accounting (new registers or reformating them). I agree with the no net change in terms of rounding up/down= no net change

 

If you can reprogram a cash register to comply with different sales tax from different states easily, you can program it to round to the nearest nickel. They are already rounding off to the nearest cent every time you make a purchase not divisable by 20 cents anyway! Whether you are in favor of keeping the cent or not, this is not an issue with any cash register worth keeping.

 

It doesn't matter much to me.

 

Penny......... U.S. Never made a Penny Only Cents.

 

I'm really amused how all these years I've been referring the cent as a penny. I'll blame my parents on that one. Then at work, I would fill the cash register when the change got low. There were rolls of quarters, dimes, nickels, and yes...pennies. It said it right on the roll. So there is a major problem with people getting the correct terminology right from the experts!

 

Actually, there is nothing wrong with the word penny. It is used universally in commerce and in American English. If you say, can I have a "roll of pennies" at the bank and they give you British Pennies, they made the mistake not you.

Ruben