In the face of ongoing protests and rioting, the French government now says a planned fuel tax increase that President Emmanuel Macron argued was crucial to fight climate change won't happen at all in 2019.
The "gilets jaunes" movement began as a protest against a rise in duties on diesel, which is widely used by French motorists and has always been less heavily taxed than other types of fuel.
The gilets jaunes vowed to continue their high-profile campaign regardless, declaring they wanted more concessions from France's leaders and would not accept "crumbs".
Why have French rioters been battling police in Paris?
It is a major climbdown by the government of President Macron, who had said the measures were necessary to combat climate change and meet budget deficit reduction targets.
The rising cost of gasoline and diesel fuel sparked protests that have since evolved into broader demonstrations against Macron's government, exposing tensions between the metropolitan elite and rural poor.
Griveaux said the wealth tax reform had not been "a gift to the rich" and was aimed at encouraging wealthy individuals to invest more in France.
Polling showed that 70 percent of French residents opposed the measure, even after they elected Macron in a landslide past year.
Just a day after Prime Minister Edouard Philippe announced the rises would be suspended for six months from their original introduction date in January, the environment minister confirmed that they had been cancelled completely.
On Wednesday, De Rugy said a period of a year was made a decision to assuage fears that the unpopular increase would be merely postponed, only to be reintroduced once the protests stop.
Experts say the government may have reacted too late to the street protests, a regular feature of French political life which have repeatedly forced Macron's predecessors into U-turns.
Public support for the yellow vests had been widespread in France, rated at 70 percent according to some opinion polls.
Leftwing critics and labour unions have said the tax cut for the rich was particularly galling since Mr Macron's government has raised taxes or cut benefits for pensioners and others at the lower end of the social ladder.
It may not sound like much, but the proposal filled the streets with protesters in yellow jackets for three weeks.
Numerous demonstrations were over a new university application system.
Last weekend, more than 130 people were injured and 412 arrested in the French capital.
"Trump also retweeted a false claim from American conservative student activist Charlie Kirk that said: "'We want Trump' being chanted through the streets of Paris". Some 4,500 police officers were deployed to deal with about 10,000 protesters in Paris alone.
On Wednesday, France's largest farmers' union said it will launch anti-government protests next week after trucking unions called for a rolling strike.
Four people have died in the Yellow Vest protests so far, and an estimated 75,000 people took part in demonstrations that turned violent in Paris this past Saturday.
Fuel shortages due to blockades remain a problem in areas of Brittany, Normandy and southeast regions of France.