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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
AMENDED
cash transactions; mandatory rounding method
Purpose
Requires sellers to apply the Swedish rounding method in cash transactions if one-cent coins are not available or utilized at a point of sale.
Background
The U.S. penny, officially known as the cent, was created by the U.S. Mint shortly after its establishment in 1792. The penny is the lowest face-value physical unit of U.S. currency currently in circulation. Under federal law, the U.S. Secretary of the Treasury has the authority to mint and issue pennies in amounts necessary to meet the needs of the United States. In 2025, the U.S. Mint was instructed to stop making pennies and on November 12, 2025, the last penny was produced for general circulation (U.S. Mint; 31 U.S.C. §§ 5111 and 5112).
The Weights and Measures Division of the Arizona Department of Agriculture (Division) is established to promote fairness in Arizona commerce involving weighing or measuring for commercial purposes. Duties of the Division include: 1) maintaining Arizona's standards of weight and measure based on national standards maintained by the federal government; 2) licensing weighing and measuring devices used in Arizona; 3) conducting a wide variety of inspection programs to protect the marketplace; 4) auditing measuring devices; and 5) enforcing related statutes, rules, and regulations (A.R.S. Title 3, Chapter 19).
Statute outlines trade and commerce practices in general and for particular industries and transactions, including practices that are deemed unlawful (A.R.S. Title 44).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Requires a seller, if one-cent coins are not available or are not used by the seller at a point of sale, to apply Swedish rounding to the total transaction amount to the nearest five-cent increment as follows:
a) rounded down if the amount ends in one or two cents;
b) rounded up if the amount ends in three or four cents;
c) rounded down if the amount ends in six or seven cents or
d) rounded up if the amount ends in eight or nine cents.
2. Applies Swedish rounding to a final total transaction amount of a cash transaction after taxes, fees and other charges are calculated.
3. Exempts, from Swedish rounding, a transaction that is paid by credit card, debit card, electronic funds transfer, mobile payment application or other non-cash payment
4. Requires a seller that is subject to Swedish rounding to post a notice that is visible to customers at the point of sale stating: cash transactions are rounded to the nearest five-cent increment pursuant to state law.
5. Prohibits a seller from applying a rounding method other than Swedish rounding.
6. Requires a seller to calculate and remit all taxes and fees that are imposed by a state or municipal taxing authority based on the sales price before the cash transaction was rounded.
7. Requires the Swedish rounding requirement to be enforced by the Division.
8. Allows the Division to issue warnings and orders and impose civil penalties relating to the Swedish rounding requirement.
9. States that a seller is not in violation of any other state or municipal requirement, law, regulation or standard if the action is based in compliance with rounding requirements.
10. States that the Swedish rounding requirement is intended to operate consistently with federal law that governs U.S. coinage and legal tender.
11. States that the Swedish rounding requirement does not:
a) declare any coin or currency invalid as legal tender;
b) require acceptance or refusal of any specific denomination of U.S. coin or currency; or
c) preempt, conflict with or supersede any provision of federal law regulation.
12. Contains a statement of legislative intent.
13. Makes conforming changes.
14. Becomes effective on the general effective date.
Amendments Adopted by Committee
1. Removes the exemption of the sale of an individual item from Swedish rounding.
2. Requires a seller to calculate and remit all taxes and fees that are imposed by a state or municipal taxing authority based on the sales price before the cash transaction was rounded.
3. States that a seller is not in violation of any other state or municipal requirement, law, regulation or standard if the action is based in compliance with rounding requirements.
4. Adds a statement of legislative intent.
5. Makes conforming changes.
Senate Action
RAGE 2/11/26 DPA 6-0-1
Prepared by Senate Research
February 12, 2026
JT/HD/ci