LONDON, Aug 6 (Reuters) - British retailer John Lewis [JLP.UL] said sales growth slowed last week, fuelling concerns consumers, worried by prospective tax rises and employment uncertainty, are becoming more wary in their spending.

Photo : Corbis

The employee-owned firm, traditionally seen as a bellwether of the UK retail sector, but which has outperformed competitors for over a year, said sales at its 28 department stores and one "at home" store increased 5.3 percent to 52.7 million pounds ($83.8 million) in the week to July 31.

The outcome followed rises of 8.2 percent and 9.8 percent in the previous two weeks respectively.

It took John Lewis' sales growth for the 26 weeks to July 31 to 14.9 percent, with the retailer winning market share from rivals.

"Looking ahead, our first-half year's form should give us great confidence for the all-important second half. But we should be realistic in our expectations as we come up against stronger figures from last year. I suspect we won't finish with another 15 per cent advance," said managing director Andy Street.

On Wednesday two of Britain's biggest retailers, fashion chain Next (NXT.L) and floor coverings retailer Carpetright (CATVU.L) reported a cooling in consumer demand, raising fears that higher taxes and public spending cuts aimed at reining in record government borrowing could derail the economic recovery.

"The (John Lewis) data do suggest that consumers are becoming more cautious in their spending," said Howard Archer, chief economist IHS Global Insight.

"The substantial fiscal squeeze will increasingly hit public sector jobs and consumers' pockets, while households already face high unemployment, muted earnings growth, elevated debt levels and high fuel prices."

John Lewis also owns the 231-store Waitrose supermarket chain, where week to July 31 sales rose 9.3 percent to 90.4 million pounds, underlining its status as one of the UK's fastest growing grocers.

(Reporting by James Davey, editing by Mark Potter)