Washington State Moves to Standardize Cash Rounding After Penny Production Ends

Lawmakers aim to provide clear rules for retailers on rounding cash transactions to the nearest nickel.

Feb. 9, 2026 at 3:31pm

Got story updates? Submit your updates here. ›

When the federal government stopped producing pennies, it left it up to states to decide how retailers should handle cash transactions. In Washington, lawmakers are now trying to establish a uniform approach that would require merchants to round cash payments up or down to the nearest 5 cents, while payments made by credit or debit card would not be affected.

Why it matters

The end of penny production has created challenges for retailers, who have been unsure of the best practices for rounding cash transactions. This legislation aims to provide clear guidelines that are easy for both businesses and consumers to understand, while also addressing concerns from the retail industry about tax obligations and potential consumer lawsuits.

The details

The proposed legislation, House Bill 2334 and Senate Bill 6230, would direct retailers to round cash transactions up or down to the nearest 5 cents. For example, if a purchase is $4.97, it would be rounded down to $4.95, and if the amount is $4.98, it would be rounded up to $5.00. Retailers would still be able to accept the exact amount if customers want to use pennies. The state Department of Revenue estimates up to 400,000 taxpayers with retail sales will be affected, and the department plans to issue guidance to businesses once the legislation is enacted.

  • In December, the federal government announced it had stopped producing pennies due to the high cost of manufacturing them.
  • The proposed legislation, House Bill 2334 and Senate Bill 6230, is currently making its way through the Washington state House and Senate.

The players

April Berg

A Democratic state representative from Mill Creek, Washington, and the sponsor of House Bill 2334.

Molly Pfaffenroth

The government affairs director for the Washington Food Industry Association, who has been advocating for the legislation on behalf of grocers and convenience store owners.

Washington Department of Revenue

The state agency that will be responsible for issuing guidance to businesses once the legislation is enacted.

Got photos? Submit your photos here. ›

What they’re saying

“This was not something that I wanted to do or write or have to deal with during this short session, but it does matter. It is going to cost businesses time and money. It's going to cost customers frustration at the register, unless our state steps in and comes up with clear, consistent rules.”

— April Berg, State Representative

“Over the holidays, one of the busiest times of year for grocery stores, my members have experienced challenges providing exact change. This bill provides the guardrails that we need.”

— Molly Pfaffenroth, Government Affairs Director, Washington Food Industry Association

What’s next

The House Finance Committee has advanced an amended version of House Bill 2334 that addresses concerns from the retail industry. Senate Bill 6230 has also passed out of the Senate Business, Trade and Economic Development Committee and is now headed to the Senate Transportation Committee.

The takeaway

The end of penny production has created a need for clear and consistent rules around cash rounding, and this legislation aims to provide a standardized approach that balances the needs of businesses and consumers in Washington state.