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Lowly, devalued Canadian penny fading out of existence
Some people pinch their pennies; others spend them.
Bill Ransom prefers to donate the single-cent coins, which the federal government started to phase out from Canada’s coinage system on Monday.
"All we've been doing is rounding up and down today, and then we'll probably just donate down the road," said Ransom, owner of the Wandering Moose Cafe in Cumberland, also vice-president at the Cumberland Chamber of Commerce. "We donated a bunch already last year to the museum."
Government is phasing out the penny due to rising costs of production relative to the coin's face value. The Department of Finance website also notes the increased accumulation of pennies in households, environmental considerations, and handling costs on retailers, banks and the economy.
"It doesn't bother me that they've taken the penny away," Ransom said. "It costs the country more money to make than it is to have it."
Eliminating pennies is expected to save taxpayers $11 million per year.
Nevertheless, one unnamed Valley retailer feels the coin still has a place in the world, suggesting charities that rely on donations of pennies might suffer.
"This has been a long time coming," Comox Valley Chamber of Commerce president/CEO Dianne Hawkins said. "There will be some adjustments...Anything using debit/credit will not be rounded, because they can be settled electronically to the exact amount."
The change will affect only cash, not electronic or cheque transactions. Businesses are encouraged to round cash transactions up or down to the nearest five-cent increment. For instance, sales of $1.01 or $1.02 will be rounded down to $1 while $1.03 or $1.04 will be rounded up to $1.05.
It remains up to businesses whether or not to continue using pennies, which will be legal tender indefinitely.
"Yesterday was business as usual," Jenny Deters, owner of Rattan Plus Home & Patio in Courtenay, said Tuesday. "Most people knew it was happening. I didn't see any real reactions from the customers yesterday...It's not going to affect us very much."
While most prefer plastic, Deters figures about five per cent of her customers use cash.
Ransom, on the other hand, sees about a 50/50 split among café patrons who choose cash over debit or credit.
"If somebody comes in and wants to use pennies, they're going to have to give me five because I'm rounding up, or I'm rounding down," he said.
"It will be interesting down the road if they (government) decide they want to take away the nickel or the dime — a whole different ball game."
For more information visit www.fin.gc.ca/1cent/faq2-eng.asp, or call 1-800-622-6232. TTY: 1-800-926-9105.