Wu’s commercial tax rate proposal sent to subcommittee

The City Council referred Boston Mayor Michelle Wu’s proposal to increase commercial property tax rates to a subcommittee at its Wednesday meeting. Wu’s proposed legislation comes amid a decline in property values post-pandemic and ahead of an election year, though the incumbent has not announced her plans to run for a second term in 2025.

The proposal, her office says, would protect residents from “sudden and dramatic tax increases” by temporarily shifting some of the tax burden to commercial properties. Real estate trade groups warn the move would increase the burden on an already struggling office market and could deter new investment. If the proposal is passed by the City Council, it will next head to the state Legislature and Governor Maura Healey for approval, where its fate also remains uncertain. The legislation could go into effect as soon as July, the start of the 2025 fiscal year, though the Wu administration could wait to implement it in either of the following two years. It would sunset after five years. Wu said the aim is not to increase the total amount of revenue that City Council collects from taxpayers but rather to ensure that the city can maintain current funding. “As Boston invests in revitalizing our downtown and commercial corridors in response to shifting market trends, we are working with all stakeholders to protect residents and homeowners against sudden and dramatic tax increases,” Wu said in a statement released by the city. “For our seniors on fixed incomes, for families with children, for frontline workers and all our community members, we must have the tools to address rising housing costs and keep residents in their homes.” The matter was referred to the council’s government operations committee with no discussion Wednesday. A hearing date has not yet been announced.