Finance Secretary Carlos Dominguez on Tuesday said he is willing to accept changes in the proposed tax reform measures but not a change in the deficit ceiling targeted at three percent of the country’s gross domestic product.

At the 2nd Economic Journalists Association of the Philippines Forum, Dominguez acknowledged all proposals to reform the tax system face hurdles.

Expected revenues from the first tax reform package, signed into law in December 2017 as the Tax Reform for Acceleration and Inclusion Act, is around P90 billion, lower than the projected P130 billion under the proposal by the Department of Finance because of changes introduced by legislators.

Dominguez said the lower-than-expected revenues is acceptable. “In a democracy, many people have many ideas so we must listen to different ideas that are put out there,” he said.

Gains from tax reform measures are targeted to finance the government’s massive infrastructure program to ensure sustained growth of the economy.

Under the infrastructure buildup program, the government plans to spend at least P8 trillion until 2022 when its term ends.

The bulk of the projects is to be financed by official development assistance (ODA) loans.

Economic managers have set the budget gap to three percent of GDP to allow for increased spending for infrastructure.

However, Dominguez said the deficit cap must not exceed three percent of domestic output.

“We will not prejudice the entire economy by exceeding three percent or around that area,” he added.

Budget and Management Secretary Benjamin Diokno, at the same event, said the deficit ceiling of two percent set earlier, is acceptable to foreign investors.

Dominguez and Diokno meant that a wider-than-programmed deficit would ruin the buildup program as government is forced to allocate scarce revenues to service the resulting debt instead of spending them on the delivery of services such as health, security or education.

Also, the budget chief said the government remains open to Public-Private Partnership (PPP) program to implement priority infrastructure programs.

“The PPP is still there. It’s still an option,” he said.

Of the 75 projects identified as priority, Diokno said 48 will be funded by ODA, 12 through the General Appropriation Act, seven by the Asian Development Bank, six through PPP and one each will be financed by the World Bank and a private loan.