View - The Municipality of Lambton Shores

THE MUNICIPALITY OF LAMBTON SHORES
TR Report No. 19-2013 Tuesday, February 5, 2013
TO:
FROM:
RE:
Mayor Weber and Members of Council
Janet Ferguson, Treasurer
Phasing Out of the Penny
RECOMMENDATION:
For information only.
REPORT
As part of the Economic Action Plan 2012, the Federal Government announced it would
phase out the penny from Canada’s coinage system. The Royal Canadian Mint will
cease the distribution of pennies to financial institutions on February 4 th , 2013. On this
date, businesses will be encouraged to begin rounding cash transactions in a fair and
transparent manner. As financial institutions will no longer be receiving pennies from
the Mint, they will not distribute pennies to consumers and businesses after February
4 th , 2013.
After reviewing the legislated changes and requirements going forward, the Finance
Department has opted to offer penny change to our customers who pay by cash, up to
April 1 st , 2013. This will allow our Offices to use up their cash drawer penny supply and
give our customers a reasonable amount of time to become aware of and accustomed
to the “rounding up and rounding down” for payment of cash transactions. Guidelines
for the implementation are noted below.
The phasing out of the penny will have no impact on the calculation or reporting of the
HST.
Rounding Guidelines
Only cash transactions require rounding, either up or down to the nearest five-cent
increment. Cheques and transactions using electronic payments – debit and credit
cards – do not need to be rounded because they can be settled electronically to the
exact amount.
The following guidelines have been recommended –
Round Down
Round Up
$1.01 or $1.02 $1.00 $1.03 or $1.04 $1.05
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$1.06 or $1.07 $1.05 $1.08 or $1.09 $1.10