On Monday the #yourtaxis hashtag asked for positive taxi stories, but this drew a slew of serious complaints such as attempted sexual assault by drivers.
On Remembrance Day it was accused of poor taste for misspelt tweets linking veterans taking taxis to its campaign.
VTA said it would rethink its strategy after it was mocked online.
"Unfortunately, the YourTaxis campaign concept and its delivery did not match our intention," VTA said in a statement.
"We were aware of many of the issues that passengers face but the campaign concept and delivery showed us the true extent of their concerns.
"We take full responsibility for the campaign and will be undertaking a full review of our strategy."
On Wednesday, the @yourtaxis account tweeted: #RememberanceDay 600,000 taxi trips are taken by war Veterans and widows for treatment purposes. Lest We Forget. #yourtaxis".
It was later taken down and then followed by an apology tweet, again misspelling Remembrance Day.
The social media slip-ups cap off what has been a difficult year for the taxi industry in Australia, which has been plagued by the rise in popularity of ride sharing companies such as Uber.
But the city of Melbourne has faced particular publicity battles last month, including allegations an Aboriginal actor was refused service , and claims Border Force officers were to carry out checks at Melbourne taxi ranks.
According to the new Your Taxis website "the Victorian taxi industry is a key contributor to the state's economy with over 30,000 accredited drivers generating A$275m (US$196m;Â£128m)  in taxes, $820m in fare revenue."
Australia's Victorian Taxi Association (VTA) has fired its social media agency after a campaign aimed at fixing the ailing taxi industry backfired.