The world number one, who previously claimed the trophy in 2013, picked up the £200,000 first prize in style as he firstly saw off Adrian Lewis 10-4 in the semi-finals before sweeping past Taylor in the decider.
Van Gerwen, who also pockets a £25,000 bonus for topping the league table during the 16-game regular season, was at his brilliant best in the final as he took five straight legs to move from 2-1 down to lead 6-2, before a showpiece 100 finish which featured two double tops stopped Taylor's fightback stone dead.
That checkout sparked another five-leg burst which saw the Dutchman take the title and reclaim one of the sport's most coveted trophies.
"It's been an amazing season for me and I'm so proud to win this title again," said van Gerwen. "Behind the World Championship, this is probably the biggest tournament and it was one of my goals this year to win this trophy.
"It's extra special for me after losing in the final for the last two years. I could have won those games but I let myself down and I can't ask for anything more than this because to beat Phil is a pleasure in itself as he's the greatest player who's ever lived.
"I was really solid tonight and I didn't make many mistakes. I did the right thing at the right moments and I'm really glad with this result.
"It's not all about tonight, but about the last 16 weeks. You put so much effort in and try to do well and it's paid out by winning this trophy."
Taylor had ended Gary Anderson's title defence with a 10-7 victory in their semi-final, with the Scot hitting back from 8-4 down at one stage to trail by just one leg before Taylor took out a key 79 before sealing victory.
However, the Stoke legend's bid to win a seventh Premier League title was ended as he lost out again to van Gerwen in the decider, as he had in 2013.
"I'm very proud to have got through to the final," said Taylor, whose last Premier League win came in 2012. "Michael beat me up, put me under pressure and made me miss doubles.
"He's doing phenomenal things and I did my best, but I just couldn't react against him. His scoring is good but his finishing is phenomenal and that's where he hurts you."
Lewis had landed a nine-dart finish during the league season in Belfast, but saw his bid to claim the Premier League title for a first time derailed by van Gerwen in the last four.
"It was one of those nights for me," said Lewis. "I felt like I threw good darts but they were landing just on the wrong sides of the wires, but Michael was the better man and deserved to win.
"I'm proud to have reached the Play-Offs in such a competitive field, but I know I've got more to give in the coming months and I'll get back on the practice board."
World Champion Anderson was aiming to win his third Premier League title, and admitted: "It's really disappointing for me. I missed too many doubles and then when I got back at Phil I just couldn't get level, but I'll be back.
"After the start I had to the season I did well just to get to the Play-Offs, but when you’re here you want to win it and I’ve not done that tonight."
Betway Premier League Play-Offs
Thursday May 19
The O2, London
Michael van Gerwen 10-4 Adrian Lewis
Phil Taylor 10-7 Gary Anderson
Best of 19 legs
Michael van Gerwen 11-3 Phil Taylor
Best of 21 legs
Michael van Gerwen v Adrian Lewis
1-0 - Lewis lands the game's first 180, but van Gerwen takes out 87 on the bull to claim the opening leg.
2-0 - Lewis misses two darts to hit back, and van Gerwen breaks throw to double his lead.
2-1 - The pair trade 180s before Lewis punishes van Gerwen's miss at tops by hitting the same bed to complete a 14-darter.
3-1 - Lewis misses his chance to punish van Gerwen, who returns to recover from six missed doubles by landing double one.
4-1 - van Gerwen moves three legs clear with a 14-darter, landing double eight.
5-1 - van Gerwen opens with a 180 before finishing 76 for an 11-darter to continue his charge with another break of throw.
6-1 - Lewis misses tops to take out 98, and van Gerwen hits the bed to win a fourth successive leg.
6-2 - van Gerwen misses the bull to finish 164 and a further two darts at doubles, and Lewis pounces to hit back by finishing 83 on double nine.
6-3 - Lewis lands a 177 before breaking throw with double 18 to complete a 13-darter as he cuts the gap to three legs.
6-4 - Lewis posts his third 180, with the pair both missing one dart at a double before the Stoke ace continues his revival with double five.
7-4 - van Gerwen hits a fourth maximum before taking out 81 for an 11-darter.
8-4 - Lewis wires the bull to finish 122, and van Gerwen punishes his rival by taking out 107 on double 18.
9-4 - van Gerwen's fifth 180 is followed by double eight as he moves a leg away from the final.
10-4 - The Dutchman scores 177 and 180 before finishing 64 on tops for another 11-dart leg to seal his place in a fourth consecutive Premier League final.
Phil Taylor v Gary Anderson
1-0 - Anderson lands a 180, but Taylor takes the lead with a crowd-pleasing 96 finish of single 20, double 18 and double top.
2-0 - Taylor lands a 180 before punishing Anderson for a miss at tops by hitting the bed himself for a break of throw.
2-1 - Anderson fires in another maximum before finally getting his first leg on the board courtesy of double one, after Taylor misses a dart at tops for a third leg.
2-2 - The pair trade maximums before Anderson returns on double five, after Taylor misses the bull to finish 161.
3-2 - Both players again hit 180s before Taylor regains the edge.
3-3 - Taylor's miss at tops allows Anderson in to level once more.
4-3 - Taylor hits a fourth 180 before taking advantage of Anderson's miss at tops, for a 120 finish, by landing double ten.
4-4 - Anderson hits tops to square the contest once more.
5-4 - Taylor takes out 72 to move himself back ahead.
6-4 - Anderson misses his chance to level, and Taylor takes out 52 on double 16 to break throw and restore his two-leg lead.
7-4 - Double eight sees Taylor move three legs clear for the first time.
8-4 - Taylor lands double 16 to move two legs away from the final.
8-5 - Anderson hits back by finishing double two.
8-6 - Taylor opens with a 180, but is punished for misses of his own as Anderson takes out 93 on double 18 to halve the deficit with back-to-back legs.
8-7 - Anderson fires in his sixth maximum of the game before taking out tops for an 11-darter to continue his brilliant revival.
9-7 - Taylor halts the reigning champion's charge by taking out 79 on double 11.
10-7 - Taylor takes out double 16 for a 13-darter to secure his place in the final and end Anderson's title defence.
Michael van Gerwen v Phil Taylor
0-1 - Double 12 sees Taylor claim the opening leg.
1-1 - van Gerwen takes out 121 as he levels the contest.
1-2 - Taylor finishes 51 as he edges back in front.
2-2 - Tops sees van Gerwen square the game.
3-2 - van Gerwen claims the final's first break with a 60 finish.
4-2 - Three misses from Taylor to break back and level allow van Gerwen back in on double 16 as he moves two legs clear.
5-2 - van Gerwen lands a 180 before returning from a missed bullseye to finish double eight.
6-2 - Tops sees van Gerwn win a fifth successive leg.
6-3 - Taylor takes out 80 with two darts to respond with his first leg in six.
7-3 - Taylor leaves 40 as he bids to cut the gap to two legs, but van Gerwen finishes a brilliant 100 with single 20 and two double tops to regain his breathing space.
8-3 - van Gerwen finishes 76 to move five legs clear of his rival.
9-3 - The Dutchman kicks off with two 180s, and though he is unable to complete a nine-dart finish he returns to finish double eight for a 13-dart leg.
10-3 - Taylor misses three darts at doubles across two visits, and van Gerwen steps in on double ten to move a leg away from glory.
11-3 - Double four sees van Gerwen seal his second Betway Premier League title in style.