Exit of the penny may require rounding off your change
(NC)—Did you know that the Canadian penny now costs more than 1.6 cents to make? Since the first one was struck in 1908, today's penny is worth only one-twentieth of its original value.
Many countries have faced the same issues with their smallest unit of currency, so in Canada as well, a penny phase-out has begun. Once the one-cent coin is fully phased out of circulation, the federal government estimates ongoing savings to the taxpayer of $11 million a year.
Shoppers will only be affected when making transactions in cash. If change is due to you and if no pennies are available, it's expected that rounding either up or down to the nearest five-cent increment will become standard practise. When that happens, business owners can turn to a federal government guideline to ensure rounding is done in a fair and transparent manner. If paying by credit card, debit card, or cheque, the exact value of the goods and services will be charged, with no need for rounding.
If your cup of coffee is $1.83 and your sandwich is $2.86, the subtotal is $4.69, plus $0.23 tax for a total of $4.92. If you pay with a credit card, debit card of cheque, you pay $4.92. If you pay cash with a $5 bill, and if no pennies are available, rounding takes place and the vendor will give you either a nickel or a dime as change.
More information is available online at actionplan.gc.ca/penny.
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