Boston Mayor Michelle Wu said she remains confident in her plan to raise commercial tax rates despite significant pushback from the business sector, adding that there’s no Plan B: if it doesn’t pass, residents will be left with higher taxes.

Wu also characterized criticism that her plan would result in negative long-term changes on the city’s economy as “misinformation” and pushed back on suggestions that she should instead look to make cuts to the city budget. The resulting reduction in municipal services that enhance public safety and street cleanliness would be far more harmful to businesses than a temporary tax hike, she said.

Mayor Michelle Wu (Nancy Lane/Boston Herald)

“In the very, very short-term it is a choice, given the tax laws that we have, between protecting our residents and making sure that residential taxes do not become even greater of a burden, and being able to maintain the same balance that our tax base has had over multiple decades,” Wu told the Herald Thursday.

“This is not about creating drastic changes to any single sector over another. It’s simply giving us a tool to maintain the balance that we have within our tax system,” she added.

Wu noted that a recent Moody’s report affirmed the city’s strong AAA bond rating, and in doing so, backed her plan to tax businesses beyond the state limit for the next four years as an “important” legislative tool that would help to stabilize Boston’s tax base during today’s post-pandemic economic challenges.

While her proposal is responsive to declining commercial property values that she says would otherwise lead to a spike in residential property taxes in the short-term, Wu was optimistic about the long-term viability of the city’s economy.

She stated that downtown foot traffic is growing, remote-work-driven office vacancies are going down and unemployment is very low, and that her plan was meant to be a short-term solution to today’s less rosy conditions.

The mayor also characterized Boston as being business-friendly, an assertion that was directly contradicted earlier this week by Greater Boston Chamber of Commerce President and CEO Jim Rooney, who said City Hall policies like Wu’s tax classification plan are driving businesses away and hindering development.

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A new report issued by the global tax consulting firm Ryan found that the mayor’s proposal would result in $2.6 billion in immediate commercial assessment loss, make Boston less competitive, and backfire on Wu’s plan to protect residents by leading to much higher taxes for homeowners down the road.

Wu said Friday on WBUR’s Radio Boston that much of the pushback is driven by “misinformation,” and that her plan seeks to be responsive, in part, to feedback from employers who say the top challenge facing their employees is the cost of housing, which would be exacerbated by a hike in residential taxes.

If her home rule petition doesn’t pass the City Council and state Legislature, there’s no plan B, she said, other than the forced result of higher residential taxes.

“The alternative that it seems many who are pushing against this residential tax relief proposal are saying is we’ll just cut city services, cut it by $100 million,” Wu said. “That would actually end up hurting our business community just as much as it would hurt our residents.”