Why do you have pennies?

Answer 1

If the word "you" refers to the US, there are a couple of reasons.

One is tradition, because the US has historically been very resistant to changing its coinage system.

The other, more practical reason is that the US doesn't have a national tax like a VAT or GST that's applied uniformly on all sales. Instead, states, cities, and even smaller administrative districts like townships are allowed to levy sales taxes in varying amounts. This causes a lot of prices to end up as uneven amounts like $10.48 or $2.37. That means low-denomination coins are needed for making change in order to minimize the possibility of unfair rounding in the absence of any national laws controlling how prices would be adjusted.