SHB 2334
SignedHouse
Cash transactions/pennies
Adjusting the price of a cash transaction to eliminate the need for pennies.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill requires businesses to round cash transaction totals to the nearest 5-cent amount, eliminating the need to handle or count pennies in cash sales. It applies only when payment is made in cash (U.S. coins and currency), not for card or electronic payments, and takes effect on July 1, 2026.
- Requires rounding of cash transaction totals to the nearest 5-cent increment — down for totals ending in 1, 2, 6, or 7 cents; up for totals ending in 3, 4, 8, or 9 cents.
- Applies only to cash payments (legal tender), and does not affect payments made by credit card, debit card, mobile payment, check, or other non-cash methods.
- Applies to the final price after taxes, fees, and discounts are applied — known as the 'total price'.
- Requires the Department of Revenue to adopt rules for handling transactions that mix cash and other payment types.
- Defines key terms like 'legal tender', 'total price', and 'transaction' to clarify scope and application.
Who is affected
- Retailers and service providers — Retail businesses and service providers that accept cash payments will need to adjust cash-based transactions to round totals to the nearest 5-cent increment, which may require changes to cash-handling procedures and point-of-sale systems.
- Cash-paying consumers — Consumers who pay with cash may see their final bill rounded up or down by 1 or 2 cents per transaction, depending on the total amount due.
- Washington State Department of Revenue — The Washington State Department of Revenue will be responsible for adopting rules to implement the rounding requirements, especially for mixed-payment scenarios (e.g., cash plus card).
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (4)
Cash-paying consumers and small businesses will no longer need to handle or count pennies, reducing time and friction in cash transactions. For consumers, this eliminates the need to carry or exchange small change; for small businesses, it reduces cash-handling errors and speeds checkout. Given that pennies cost more to produce than their face value and are increasingly irrelevant in digital commerce, this simplification benefits everyday people who transact in cash — especially low-income workers, seniors, and the unbanked.
FinancialPeopleRef: Sec. 1(1) and Sec. 2(1)By limiting the requirement to cash-only transactions, the bill avoids disrupting card-based commerce and preserves consumer choice — allowing businesses to continue offering exact pricing for non-cash payments. This minimizes disruption to existing systems and reduces compliance burden, since most retail transactions are already card-based. The phased implementation (July 2026) gives businesses time to adapt, and the rulemaking authority ensures flexibility for edge cases.
Business & EmploymentPeopleRef: Sec. 1(2) and Sec. 2(2)Clear definitions of “legal tender,” “total price,” and “transaction” reduce ambiguity in enforcement and help prevent disputes over final cash totals. This clarity supports fair commerce and reduces opportunities for deceptive pricing practices — especially beneficial for consumers who may be vulnerable to rounding manipulation or misrepresentation at point of sale.
Public SafetyLean peopleRef: Sec. 1(4)(a)–(c) and Sec. 2(4)(a)–(c)Minimal fiscal impact on state and local governments — the Department of Revenue expects only minor rulemaking and outreach costs, with no significant revenue loss or gain. This avoids budgetary strain and ensures the policy does not divert resources from other public priorities. The low cost reflects the bill’s narrow scope and reliance on existing statutory frameworks.
Local GovernmentLean peopleRef: Fiscal Impact section
Potential Concerns (4)
Cash-paying consumers may be disproportionately rounded *up* on average, since totals ending in 3, 4, 8, or 9 cents (which round up) occur slightly more frequently than those ending in 1, 2, 6, or 7 cents (which round down) under uniform random digit distribution — leading to a small net upward bias in cash prices over time. This effect is small per transaction but accumulates across many purchases, especially for low-income households who rely heavily on cash. While the bill frames this as neutral rounding, the rounding rules create a structural, albeit tiny, regressive shift in pricing. The Department of Revenue’s rulemaking authority does not include correcting this rounding bias, and the bill provides no consumer compensation mechanism.
FinancialLean peopleRef: Sec. 1(1)(a) and Sec. 2(1)(a)The bill excludes non-cash payments (card, digital, check), meaning low-income and unbanked consumers who rely on cash may face a different effective price than those using cards — potentially creating a two-tiered pricing system where card users get exact pricing while cash users absorb rounding effects. This could discourage cash use among vulnerable populations who lack banking access, even though the bill intends to simplify cash handling.
FinancialLean peopleRef: Sec. 1(2) and Sec. 2(2)Small retailers and service providers with limited cash-handling infrastructure (e.g., food trucks, farmers markets, small convenience stores) may face modest compliance costs to update cash registers, retrain staff, or adjust manual rounding practices. While the bill does not mandate new technology, the operational adjustment may be nontrivial for micro-businesses with thin margins and limited administrative capacity.
Business & EmploymentRef: Sec. 1(3) and Sec. 2(3)The Department of Revenue’s rulemaking responsibility for mixed-payment scenarios (e.g., cash + card) introduces administrative complexity and potential ambiguity — especially if a transaction is partially paid in cash and partially in another form. The bill does not specify how rounding should apply in such cases, leaving room for inconsistent enforcement and potential disputes over final totals, which could increase enforcement burden on local auditors and tax collectors.
Local GovernmentRef: Sec. 1(4)(c) and Sec. 2(4)(c)
Who Is Most Affected
Low-income and unbanked consumers who rely on cash may benefit from reduced cash-handling friction and time savings at checkout, but could face a small net upward price bias over time due to rounding rules. The impact is mixed but leans positive overall due to convenience and inclusion in cash-based commerce.
Small retailers (e.g., corner stores, food trucks, farmers markets) benefit from simplified cash handling and reduced need for penny counting, but may face minor compliance costs in updating procedures or training staff. The impact is modestly positive, especially for those with high cash-volume operations.
Large retailers and chains with automated POS systems will likely incur negligible costs — many already round to nearest 5 cents in practice — and may benefit from standardized procedures across locations. The impact is slightly positive due to operational consistency and minimal adaptation needed.
The Washington Department of Revenue gains rulemaking authority but faces only minor administrative burden. The agency’s role is limited to clarifying edge cases (e.g., mixed payments), so the impact is neutral with slight operational burden.
Card-using consumers see no direct impact, as the law excludes non-cash payments. However, they indirectly benefit from reduced cash-handling errors and faster checkout lines, which may improve overall store efficiency. Impact is slightly positive but minimal.