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Which Countries Got Rid of the Penny? What Happened Next
Other countries ran this experiment first. Nobody had to sell the house.
When the United States stopped making pennies, it was not exactly blazing a trail. Several countries dropped their smallest coin years or decades earlier, and they left paperwork behind: budget speeches, rounding rules, central bank testimony. Here is what they did, and what happened to prices afterward.
Quick answer: Australia withdrew its 1 and 2 cent coins starting in February 1992. New Zealand demonetised its 1 and 2 cent coins in 1990 and dropped its 5 cent coin in 2006. Canada stopped distributing pennies on February 4, 2013. Sweden’s last öre coin stopped being legal tender in 2010. Finland, the Netherlands, Belgium and Ireland round cash totals so the 1 and 2 euro cent coins are rarely needed. In each case, cash totals are rounded, card payments are left alone, and the central bankers who looked found no noticeable effect on inflation. The U.S. stopped making circulating pennies in November 2025 and is now doing much the same thing.
Australia, 1992
Australia’s Treasurer announced the end of the 1 and 2 cent coins in his Budget Speech of 21 August 1990, according to the Royal Australian Mint. The reasons were the two you would guess: inflation had eaten their purchasing power, and they cost too much to mint. Both coins were withdrawn from circulation starting in February 1992. The government’s press release said they would continue to be legal tender.
A Western Australian government statement from 30 January 1992 spelled out the details. The Reserve Bank would stop issuing the copper coins from 1 February. Prices could still be set to the cent. When the small coins were not available, businesses would round to the nearest five or ten cents, following Federal Treasury guidelines. Cheques, credit cards and EFTPOS payments did not need rounding, and bills such as electricity and phone accounts would still be charged to the exact cent. The Prices Surveillance Authority was given the job of watching for unwarranted price rises.
The coins themselves were a little nicer than ours. Both were 97 percent copper, and the reverses, by Stuart Devlin, showed a feather-tailed glider on the 1 cent and a frill-necked lizard on the 2 cent.
New Zealand, twice
New Zealand went further. According to the Reserve Bank of New Zealand, the issue of 1 and 2 cent coins stopped on 31 March 1989, and both were demonetised on 30 April 1990. Demonetised means they stopped being legal tender, which is a step Australia, Canada and the U.S. did not take.
Then, in 2006, New Zealand did it again. When smaller 10, 20 and 50 cent coins arrived on 31 July 2006, the Reserve Bank began withdrawing the 5 cent coin, which was not replaced. The old coins were demonetised with effect from 1 November 2006.
What happened to prices? Alan Boaden, the Reserve Bank’s head of currency, told a Canadian Senate committee in October 2010 that no thorough study of inflation was done after the 1 and 2 cent coins left. A Consumer NZ survey did find that prices “actually fell slightly.” For the 5 cent coin, a small check of about 50 retail items found some prices rose and some fell, with no obvious difference. His summary was that there were no discernible effects on inflation either time.
Canada, 2013
Canada’s 2012 federal budget cited the penny’s “excessive and rising cost of production relative to face value” and estimated savings of $11 million a year. The last Canadian penny was struck at the Royal Canadian Mint’s Winnipeg plant on May 4, 2012, by Finance Minister Jim Flaherty. That coin went to the Bank of Canada’s Currency Museum. The Mint stopped distributing pennies on February 4, 2013.
The Canada Revenue Agency’s guidance is the template most people now recognize. The cent stays the smallest unit for pricing. Only cash is rounded. Cheques and card payments are not. Rounding happens on the final amount, after GST or HST is calculated. Totals ending in 1 or 2 cents round down, 3 or 4 round up to 5, 6 or 7 round down to 5, and 8 or 9 round up to the next ten. Pennies can still be spent indefinitely with businesses that choose to take them.
Before any of this happened, Bank of Canada Deputy Governor Pierre Duguay told the Senate in May 2010 that the Bank’s preliminary research found any impact on inflation “would be insignificant and more likely non-existent.” Even if prices did round up, he said, it would be a one-time change, too small to show in a consumer price index that is rounded to the nearest 0.1 percent.
Sweden, to the whole krona
Sweden does not round to a five at all. The Riksdag decided on 25 March 2009 to abolish the 50 öre coin, the last öre coin in circulation, and it stopped being legal tender on 30 September 2010. The rounding law was changed at the same time, so cash amounts ending in 1 to 49 öre round down and 50 to 99 öre round up. In other words, cash totals go to the nearest whole krona. The öre still exists as a unit for pricing, and card payments were not affected.
When the Riksbank proposed the change in 2008, it said about two in three people in a survey thought the coin was no longer necessary. It also expected no effect on the consumer price index, because the index is calculated from unrounded prices.
The euro countries that round
None of these countries abolished their 1 and 2 euro cent coins. All four still treat them as legal tender. What they did instead was round cash totals, so the coins stop being needed.
- Finland: The Bank of Finland says retail payments are rounded in principle to the nearest 5 cents, under an Act passed in 2000. The 1 and 2 cent coins are still legal tender, but retailers do not have to accept them if they say so separately. As a result, the Bank says, they are not widely used.
- Netherlands: The Dutch government says shops may round a cash total to the nearest 0 or 5 cents, as long as they say so with window or till stickers. Its examples: €23.37 becomes €23.35, and €8.89 becomes €8.90. Card payments are for the exact amount. The coins remain legal tender, but a shop that announces rounding does not have to give them as change.
- Belgium: Rounding of cash totals became mandatory on 1 December 2019, as Belgian broadcaster VRT reported. The 1 and 2 cent coins stay legal tender, though a shop does not have to take more than 50 coins in one payment, and the National Bank said it would stop producing new ones.
- Ireland: After a trial in County Wexford, the Central Bank of Ireland rolled out voluntary rounding nationally on 28 October 2015. It said a 1 cent coin cost 1.65 cents to make and a 2 cent coin cost 2.1 cents. A year later, it reported that about 80 percent of retailers were rounding, 93 percent of people surveyed thought rounding was a good idea or made no difference, and 126 million unwanted coins had been handed in.
So what happened to prices?
Not much, as far as anyone measured. Beyond the Canadian and New Zealand testimony above, a 2018 post on the Bank of England’s staff blog reviewed studies from the U.S., Canada, Germany, Hungary and Belgium and found little to no effect on the general price level. The authors noted that the blog reflects their own views, not the Bank’s.
For the U.S., Richmond Fed economists used real cash transaction data and estimated that rounding to the nickel would cost consumers about $6.06 million a year in total. That is not nothing, but it is spread across a lot of people.
Where the U.S. fits
The U.S. Mint held its final ceremonial strike of a circulating penny in Philadelphia on November 12, 2025. The U.S. looks a lot like Canada: it stopped making the coin, kept it as legal tender, and leaned on guidance rather than a national law. Treasury’s FAQ says pennies keep their full value indefinitely, and that when a business has no pennies it may round the final cash total to the nearest five cents, after taxes, using the same 1, 2, 6 and 7 down, 3, 4, 8 and 9 up rule Canada uses. Card and other non-cash payments stay exact. Some states have passed their own laws since, covered in how rounding to the nickel works.
What the U.S. has not done is demonetise anything. Treasury estimates about 114 billion pennies are still out there, and they are all still money. The story of how this site came from that decision is in they stopped making pennies.
The one payment no country rounds away
Chris, an individual, is asking everyone on Earth to voluntarily send him exactly one cent. Nearly every rounding rule above leaves electronic payments alone, so a one-cent payment through this site stays one cent. Not zero, not five, not a whole krona. The arithmetic is on the math page, and the fine print is in the FAQ.
No rounding, no borders. One cent, sent here.
Not affiliated with the U.S. Mint, the U.S. Treasury, the Royal Canadian Mint, the Royal Australian Mint or any central bank named here. Rounding rules change, so check the local rules before you argue with a cashier.
Sources: Royal Australian Mint, one cent, Royal Australian Mint, two cents, Government of Western Australia, 30 January 1992, Reserve Bank of New Zealand, history of New Zealand coins, Senate of Canada, National Finance committee, October 6, 2010, Canada Budget 2012, Government of Canada, last penny struck, May 4, 2012, Canada Revenue Agency, GI-131 Phasing Out of the Penny, Bank of Canada, Pierre Duguay to the Senate, May 26, 2010, Riksbank, 50 öre coin to be abolished in 2010, Riksbank, proposal to abolish the 50 öre coin, Riksbank, öre abolished as unit of coinage, Bank of Finland, euro banknotes and coins, Government of the Netherlands on rounding (in Dutch), VRT on Belgium’s mandatory rounding (in Dutch), Central Bank of Ireland, rounding, Central Bank of Ireland, one year on, Bank Underground, the price impact of removing the penny, Richmond Fed on rounding, U.S. Mint, final circulating cent strike, Treasury penny FAQs.
Meet the penny jar ↗By Chris. All articles