The phrase 'I wouldn't go that far', can be used to challenge a statement which you consider extreme or exaggerated. 'I wouldn't go that far' is a response that is often given in order to put in place a boundary or a line you are not willing to cross or stating that you are unwilling to do something.

1. The best movie ever made? I wouldn't go that far. Top 20, perhaps.
2. I wouldn't go as far as to say that I agree with Mary about that, but I do think that she raises some good points.

1. Start sacking people? Look, I agree that disciplinary action needs to be taken, but I wouldn't go that far.
2. There have been suggestions made in support of discontinuing the product and I have to disagree with those, I wouldn't go that far.