House Passes Penny-Elimination Bill to Save $56 Million a Year

Q: With pennies phased out, how will retailers manipulate the century-old 99-cent pricing trick to profit from the new rounding rules?

Retailers are unlikely to abandon 99-cent pricing, but the new cash-rounding rules limit how much they can profit from it because rounding applies only to the final cash total, not to each item, and card and digital payments still settle to the exact cent. That means a $4.99 price tag still works as a psychological cue for most shoppers. The key change is at checkout: if a cash basket ends in 98 or 99 cents, the total rounds up to the next nickel; if it ends in 96 or 97 cents, it rounds down. On a single item, $4.99 paid in cash would typically become $5.00, so the classic “under five dollars” message remains, but the penny-level discount disappears in practice for cash buyers. Retailers that want to tilt outcomes could keep using .99, .98 or .94 endings, especially on items often bought alone, because many of those totals will round up by 1 to 2 cents in cash. But the law’s nearest-nickel formula also forces many totals down, so gains and losses should roughly offset over large volumes. Treasury and Fed-linked analyses have said rounding is expected to be broadly neutral overall, though the Richmond Fed estimated a small net consumer cost nationally. The bigger adaptation may be strategic rather than manipulative: merchants can preserve .99 pricing for perception while steering customers toward cards, where exact-cent pricing still applies, or shift some cash-heavy goods toward nickel-friendly endings such as .95 or .00 to reduce checkout friction and customer complaints.

1 articles · Updated · Fox News · Sep 14

A unanimous House vote sent the bipartisan Common Cents Act forward, barring new pennies except collector coins and keeping existing pennies as legal tender.
The bill would require most cash purchases to be rounded to the nearest 5 cents, while cash wages would be rounded up when totals are not divisible by 5 cents.
Treasury backed the move after penny production costs climbed to more than triple face value in 2025; the Mint had already stopped making pennies in November 2025 after 232 years.
The measure would also let the Mint use cheaper materials for nickels and orders a Treasury study on effects on low-income, older and debanked Americans.
If Trump signs it into law, Congress would lock in the penny phaseout and make it harder for a future administration to reverse.