Time to Eliminate the Penny from the U.S. Coinage System: New Evidence

Abstract

I argue that the U.S. Mint should stop producing pennies. The Mint is losing money on penny production and new evidence from a multi-state convenience store chain shows that eliminating the penny will not impose a “rounding tax” on consumers. Eliminating the penny will have a negligible impact on inflation and on convenience store costs and profits, but it will save time for customers and clerks, which may be worth about $730 million per year.