UPDATE:
Canada eliminates their penny as of 2012!
Read more: Canada Eliminates Penny
A LOT OF COUNTRIES HAVE GOTTEN RID OF THEIR VERSIONS OF THE PENNY, THE NICKEL, AND EVEN UP TO THE QUARTER! WHY HAS THE UNITED STATES NOT DONE THIS YET WITH THE PENNY?
The United States has had legislation pass to Congress to achieve these goals, however lobbyists have stopped the legislation from passing to date. You can read all about U.S. Penny Legislation.
Australia
The one-cent coin & two-cent coin were taken out of circulation in 1992.
The coins are able to be traded in at a bank, however, they are no longer considered legal currency.
The last one-cent piece was minted 1990, while the last two-cent piece was minted 1989.
Though this information is not posted on the Royal Australian Mint, a cached version of their FAQ can be found here.
Brazil
Brazil no longer minted the one-cent coin as of 2005. This was a clear reaction to rising commodity costs and inflation devaluing the need to produce to produce their version of the penny.
Britain
Britain eliminated the half cent coin due to the coin becoming irrelevant from inflation.
Denmark
Denmark eliminated denominations less than 50 öre coins. This particularly pertains to the 25 öre piece. The announcement bluntly states that the purchasing power has diminished to the point of the coin being unnecessary due to inflation. In addition, Denmark instituted a rounding system, which, as a policy, is directly related to buying power and the affects of inflation. This occurred effective 2008 - Source.
Finland
Finland realized there was no point in minting the one and two cent coins so they were discontinued. The one and two cent coins are currently minted only for collectors for numismatic purposes
Hong Kong
Hong Kong stopped minting its five cent coin since 1980.
Hungary
Hungary researched their currency in view of purchasing power. The chart on the left shows the purchasing power of their version of the penny (one Forint piece). As a result of the practical use of the one forint coin and two forint coin, a rounding system was instituted in 2008 to the nearest 0.05 decimal place. This effectively eliminated any denomination less than 0.05 from practical use in the Hungary currency system - Source.
Israel
To qualm inflationary issues and instituting currency form changes, Israel got rid of the one agora coin and five agora coin in 1991 and 2008 respectively. The coins could still be exchanged at a bank for newer currency forms, however, the coins were not used in practice after the prior mentioned dates - Source
Malaysia
Eliminated the 1 sen coin from its currency by instituting a ’rounding system’ to round transactions up to the nearest .05 ringgit.
Mexico
Mexico made the five cent coin their least valued denomination due to effects of inflation on their currency - Source.
Netherlands
The Netherlands eliminated the guilder in 1980, and the one and two cent Dutch Euro coins in 2006.
New Zealand
Instituted a ’rounding system’ to round to the nearest 0.10 and removed the one and two cent coins from circulation in 1990 and the five cent coin followed in 2006.
Sweden
Sweden eliminated the one and two öre coins from circulation in 1972, the five, ten, and twenty-five öre coin by 1991, and the 50 öre coin by 2010 - Source
Canada
Canada currently has an Alloy Recover Program where all coins that have metal value greater than face are being taken out of circulation by the Royal Canadian Mint. These coins are primarily older pennies and nickels.
United States
The U.S. eliminated the half-cent, two-cent, three-cent, half-dime coin (replaced by the nickel), and the twenty-cent coin. Legislation in progress with attempts to eliminate the one-cent penny.
Read more about U.S. penny legislation.
