About 50 members of the Taxi Action Group Committee gathered in front of Minister for Transport Jacinta Allan’s office on Monday.
The group was protesting proposed deregulation scheme put forward by the state government in August last year.
Under the scheme, taxi licences would be dumped and owners compensated up to $100,000 for their first licence and $50,000 for their second.
The reform also includes a $2 levy on every taxi, Uber or hire car trip.
Taxi Action Group Committee spokesman Anthony Parisi said the protesters wanted a fair buyback price.
“For the government to come in and deregulate and provide us with a miserable compensation. Is not okay,” he said.
“It's $100,000 where people have paid $500,000 for a taxi licence. People have mortgages and debt related to licences.”
Mr Parisi said the compensation would mean a lot of drivers would have a shortfall of $400,000.
“(Ms Allan) is a family woman herself and she should realise it’s not right to take away people's livelihoods and assets,” he said.
“We don't want to make money, we just want to get out fairly and pay our debts. Then they can do what they want with the transport system.”
The group were stationed outside of Ms Allan’s office from 11.30am until almost 1pm when they marched down Mitchell Street.
Police were on hand to make sure nothing got out of control as well as managing traffic and providing the protesters with a route down Mitchell Street.
Mr Parisi said other meetings are planned for Melbourne and possibly Bendigo in the future.
“It is just a small number (here today). We wanted to deliver a letter, that's we have all done,” he said.
“Today is out first (protest) for the year across all our groups. We have another planned for mid-January and one for February.”
The state government has been contacted for comment.