The GfK market research institute said its consumer climate index for Germany is forecast to drop to 4.8 points in February from a downwardly revised 8.5 points in January. The institute said households are significantly less optimistic about spending money following the 3 percentage point increase in Germany's VAT sales tax earlier this month. The institute's index measuring consumers' willingness to spend plummeted by 65 points from a month earlier to minus 5.1 points in January -- the strongest decline since monthly data was collected in 1980. "Apparently there is currently still great uncertainty among consumers how the higher VAT tax is affecting prices," the institute said. Income expectations improved some 11 points to minus 5.1 points, after a sharp decline in December. Consumers' expectations about the economy improved a modest 1.8 points to 37.5 points -- the highest level since January 2001. Last month, GfK had forecast the January consumer climate index at 8.7 points.