"No tax is worth it to endanger the unity of the nation", - said the Prime Minister.
Prominent Socialist figure Segolene Royal, a former candidate for president, lauded Philippe's decision but said the course correction on the climate change tax came too late.
On Tuesday, Philippe announced a freeze in electricity and natural gas prices until May 2019, and warned protesters against more disruptions.
"The French who donned the yellow vests love their country", Philippe said.
Numerous large protests took place on France's streets - at big intersections, toll plazas and other high-profile spots - as French drivers vented their fury at the government.
The backpedalling by President Emmanuel Macron's government appeared created to calm the nation, coming three days after the worst unrest on the streets of Paris in decades.
It is also a major body blow for a leader who has positioned himself as an unbending and driven reformer.
Will the president's policy appeasement mute the populist protests?
But it was unclear if the measures would assuage the anger on French streets.
"It's a first step, but we will not settle for a crumb", said Benjamin Cauchy, a protest leader.
Police asked the league leaders to call the Ligue 1 game off three days after thousands of people rioted against President Emmanuel Macron and his squeeze on household spending brought about by tax increases on diesel.
Rescinding the fuel tax hike was the main demand of the demonstrators, alongside a higher minimum wage and the return of a wealth tax on high-earners which was abolished a year ago.
Before the announcement, some officials had suggested that a wage increase might accompany the new tax to help soften the blow, but while Philippe said the administration would look into ways to help the poor and middle class who rely on vehicles, he didn't mention an increase in the minimum wage.
Furthermore, Neymar was expected to miss the Montpellier match because of injury but the Brazil star is liable to be fit for any rescheduled fixture.
Mr Philippe said: "If another day of protests takes place on Saturday, it should be authorised and should take place in calm".
The "yellow vest" movement, named after the high-visibility jackets worn by supporters, emerged on social media in October after months of swelling anger over rising fuel prices. He also met with Macron and other ministers in order to find a quick solution to the crisis.
Le Pen was quick to point out that the six-month postponement of the fuel-tax increases took the decision beyond the European elections.
Immediately after coming to power, he pushed through tax cuts for entrepreneurs and high-earners.
On Tuesday, protesters kept blocking several fuel depots and many insisted their fight wasn't over.
On Saturday, the Arc de Triomphe national monument was defaced and avenues off the Champs Elysees were damaged.
Interior Minister Christophe Castaner said extra police would be deployed next Saturday on top of the 65,000 out in force last weekend, urging "reasonable" members of the movement to stay at home.
Paris Mayor Anne Hidalgo tweeted her "indignation" and "deep sadness", saying that violence is "not acceptable".