The End Of The Cent: How Ditching The Penny Will Change Retail And Wallets

Forbes

America’s oldest coin had been around since 1793. Now that Trump has stopped the minting of new pennies, will promotional 99 cent pricing disappear? And what about sales taxes?  Read the full story on Forbes: https://www.forbes.com/sites/kellyphillipserb/2025/11/13/what-the-end-of-the-penny-means-for-consumers/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes, What the End of the Penny Means for Consumers

00:04On November 12, 2025, U.S. Treasurer Brandon Beach stepped up to a steel control panel in the penny room of the Philadelphia Mint

00:14and sent the final batch of one-cent coins clinking into a tray.

00:19With that, the penny was officially on its deathbed.

00:22No new pennies will be minted and the supply will dwindle as old ones disappear into forgotten piggy banks, sofa cushions, and junk drawers.

00:31Beach is a President Trump appointee from May 2025 and credited Trump's, quote,

00:36common sense agenda for eliminating the penny.

00:40Treasurer Beach called it a historic moment as it is the first time since 1857 that the U.S. has retired a circulating coin.

00:48The penny has been around for nearly as long as the country.

00:52Just a few years after the U.S. Constitution was officially ratified,

00:57the new government went to work hammering out the details for the new country.

01:01That included passing the Coinage Act of 1792, which ordered the minting of gold, silver, and copper coins.

01:09The first pennies, made in 1793, were made of pure copper.

01:13In 1857, the penny got smaller and cheaper to make with a composition of 88% copper and 12% nickel.

01:21However, modern pennies were made of 97.5% zinc with a 2.5% copper plating.

01:29Even with less copper used in the penny, the economics weren't making much sense.

01:34Rising metal prices and other costs meant the mint was losing money on every penny produced,

01:39about 3.69 cents per coin.

01:42At the same time, demand for small change was decreasing.

01:47Americans aren't reaching into their pockets to pay with coins anymore.

01:50Instead, they're swiping, clicking, and tapping their way through purchases.

01:55Beach said in Philadelphia, quote,

01:58Each penny costs more to make than it's worth.

02:01Ending production saves taxpayers an estimated $56 million a year.

02:06Treasury Secretary Scott Besson had already formally ordered the Philadelphia and Denver mints to stop production,

02:13following an order from President Trump.

02:16With the pennies' demise, the big question is, what happens now at the cash register?

02:21It feels like it would be simple.

02:22For cash sales, total should now be rounded to the nearest 5 cents,

02:27either up if the purchase ends in 0.03 or 0.04,

02:31or down if the purchase ends in 0.01 or 0.02.

02:36Of course, that's for cash only.

02:38For card and digital transactions, nothing changes and amounts remain exact to the cent.

02:43But it may not be that easy.

02:45At least 10 states and localities have cash laws intended to ensure cash customers are not disadvantaged

02:52compared to those using electronic payment methods,

02:55which would essentially prevent businesses from rounding cash transactions up or down.

03:01Earlier this year, the National Association of Convenience Stores, or the NACS,

03:07sent a letter to the Senate Banking and House Financial Services Committees

03:10calling on lawmakers to establish a national law to allow rounding

03:15so that businesses aren't breaking laws.

03:18That hasn't happened yet.

03:20Rounding up prices for cash but not credit could cause confusion at the register for sales tax

03:26and potentially spur some litigation.

03:29Consumers may question whether it's fair to pay more sales tax for cash purchases.

03:34And it's not just state and local laws that could be problematic.

03:37The NACS also suggested that the rounding for cash customers could violate

03:43the terms of the Supplemental Nutrition Assistance Program, or SNAP.

03:47Studies from Canada, which retired its penny in 2012, show that rounding evens out over time.

03:54But a study published with the Federal Reserve Bank of Richmond earlier this year

03:58said those studies lead to mixed conclusions.

04:01Using data from the 2023 DCPC, a Federal Reserve-sponsored survey that tracks real payments

04:09from a nationally representative sample of consumers, estimated that rounding tax-to-round

04:15cash transactions to the nearest five cents could cost U.S. consumers approximately $6 million annually.

04:22It's unclear whether Trump had the power to unilaterally eliminate the penny since currency specifications

04:29are dictated by Congress.

04:32And while the penny may be gone from the production lines, it will stay put, at least for a little while.

04:38There are still an estimated 250 billion pennies in circulation, according to the American Bankers Association.

04:45Because there are so many pennies in circulation, and they remain legal tender,

04:49it will take years for them to completely disappear.

04:52For full coverage, check out Kelly Phillip Erbs' piece on Forbes.com.

04:57This is John Palmer from Forbes. Thanks for tuning in.

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