Rounding sales tax on each item will often result in a different price than rounding once for the total. The store will collect the wrong amount of tax that way.

I'm in Ireland where EU law mandates posted prices include all taxes and charges, and fuel prices are still advertised with a .9 or .8 at the end.

They're selling a liquid, so even if it were all priced in whole cents you'd have to deal with fractional cents.

Several reasons, it really is a mess.

The local tax is set by multiple independent tax authorities that change their taxes independently, the tax you see is the aggregate of those independent authorities computed separately, which do not coordinate with each other.

Some of these taxes are conditional at point-of-sale, late-binding the taxes, such that different customers are subject to different rates across these tax authorities such that it is unlikely to round to exactly 5c.

It is widely illegal to not display the true price and taxes paid separately. Trying to retcon a price and taxes for rounding purposes that is also strictly consistent across customers so as to not violate the law is not trivial.

And on top of all of this, the Federal government does not have the authority to regulate the way States and various locales structure their sales taxes. It is a herding cats problem.

I think that's what has to happen here. Things will be priced in such a way that the final price is a multiple of 5. That's a pretty easy thing for an inventory pricing system can figure out. We already do it for fractions of a penny, not sure why it would be a big deal for a fraction of a nickel

Lots of localities total taxes aren't whole percentages so it potentially gets tricky making prices work in those systems such that you can make whole 5 cent tax included prices with whole cent base prices. Do most POS systems support arbitrary precision item prices?

> Is there a reason that couldn’t be done to make all prices + VAT multiples of 5c?

Yes, there are reasons that can't be done.

We don't have VAT in the States; we instead [usually] have sales tax.

And therein: We have something like twelve thousand different sales tax districts, all set at different percentages by combinations of states, counties and municipalities.

Some cities have multiple sales tax rates even within their bounds. My own tiny little city is at the intersection of 3 different counties, and has 3 different sales tax rates: A store on one side of the road has a different tax rate than a store on the other side, and one down the block a ways has yet a third rate.

This reality doesn't have to be ideal. It doesn't have to make sense. This is what we have whether it is awesome or terrible or some combination of both.

It would take a monumental amount of effort to unwind all of that and turn it into something nationally-unified like VAT. This process would take a very long time (perhaps decades), in part because some states don't have sales tax at all and introducing a uniform VAT would represent a very different way for them to go about the ways in which they conduct both commerce and taxation.

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Of course, there's other ways to inject something sane and predictable in the decommissioning of the penny, and there's a number of of them mentioned elsewhere in other comments. But using any of them would have required utilizing an ounce of planning or forethought, and we didn't do "planning" or "forethought" here.

The decision to stop producing came from On High, and was presented in the form of a social media post[1] from the President that declared that it simply would be this way. There was no public planning or discourse involved.

We can talk about whether that's an awesome or terrible way to enact policies, but it doesn't really matter because that business has already been concluded -- with all of the swiftness and grace of eating a ham sandwich.

[1]: https://truthsocial.com/@realDonaldTrump/posts/1139772249337...

No, it's illegal in many, looks like most states:

https://www.avalara.com/blog/en/north-america/2019/07/retail...

Now is our chance to switch to European style "you pay the price it says on the shelf"!

> Just show the price including tax.

With a tax rate as precise as 1000ths of a percent in many jurisdictions*, you'd need extreme precision on the price tag (e.g. $11.798625), OR you need to substantially overcharge for tax (rounding up the tax to the penny or nickel on each individual item, instead of on the total of ALL items).

And sales tax rates can even be different from ONE CITY BLOCK TO THE NEXT.

* Arizona: 10.725% Hawaii: 4.712% Minnesota: 7.875% etc. https://en.wikipedia.org/wiki/Sales_taxes_in_the_United_Stat...

Since that is a state thing, it can never happen and is likely outside the power of Congress to enforce, especially with our current activist federal supreme court.

Yes, stores are dealing with this alongside a whole legal framework today. They would not have the benefit of that for any changes without pennies, and in a few cases may open themselves to legal liability by underpaying state sales tax, overcharging snap recipients, etc etc. We don’t know because this was just a tweet decree by the executive while the legislature has been paralyzed.

Even with just a 6% tax, you end up with prices that need 4 digits of precision after the decimal (e.g.: $11.6494). That issue extends over a wide range of pre-tax/input prices, so one would have to DRASTICALLY change the prices so that the price including 6% tax rounds to even a penny, let alone a nickel.

While you could calculate a price that (after tax) would round a single item to the nearest nickel, it's completely IMPOSSIBLE to do so with unknown numbers of multiple items.

In addition, tax rates in the real world aren't just single-digit percentages. They have precision of 1/1000th of a percent, making such a calculation much more challenging.

Arizona: 10.725% Hawaii: 4.712% Minnesota: 7.875% etc.

https://en.wikipedia.org/wiki/Sales_taxes_in_the_United_Stat...

And sales tax rates can be different from ONE CITY BLOCK TO THE NEXT, so a company with more than one location would find it IMPOSSIBLE to advertise their prices at all.