Germany's retail industry association (HDE) expects overall sales in the retail sector in November and December to reach 75.7 bln eur, up 2 pct from the same period last year, HDE President Josef Sanktjohanser told reporters. For the full year 2006, he reiterated the HDE forecast of a 0.75 pct nominal increase in overall industry sales, equivalant to zero growth in real terms. He said the planned increase of VAT to 19 pct from 16 pct effective in January next year has a positive impact on sales in 2006 because consumers are bringing forward purchases. But for next year, the increase will lead to a decline in sales in real terms and have a negative impact on earnings. In nominal terms, he expects 2007 sales growth of 0.5-1.0 pct. He predicted that VAT increases and other additional tax burdens will reduce the purchasing power of consumers by 28 bln eur next year, of which 8 bln would represent lost sales for the retail industry. The VAT hike may well end up having to be shared among consumers, producers and retailers, he added.