The Baby Blacks fell to a 44-35 loss to Australia.
It means they will have to play Georgia on Saturday and will finish a disappointing seventh or eighth at the tournament.
Taylor, who made his debut for the Highlanders this year and has earned a full contract for 2024, scored one of New Zealand’s six tries in the loss to Australia.
Crusaders winger Macca Springer scored another try to take his tally for the tournament to five.
Fellow winger Caleb Tangitau, who is a member of the All Blacks Sevens squad, and blindside flanker Malachi Wrampling-Alec each scored two tries, while first five Taha Kemara added a long-range penalty and a drop goal to a pair of conversions.
The New Zealanders played with 14 men for an hour as lock Tom Allen was shown a yellow card for lifting an Australian player in a tackle, and the sanction was later upgraded to a red card upon review.
They rallied to score 18 unanswered points before the Australians made the most of their personnel advantage and came roaring home.
Seventh would hardly represent an achievement to crow about but the young New Zealanders should be motivated to finish the tournament on a high when they play Georgia at Danie Craven Stadium in Stellenbosch on Saturday morning (NZ time).
France and Ireland will contest the final after beating England and South Africa respectively in the semifinals.
The success of the French and Irish, following the dominance of their senior teams in recent years, will not go unnoticed by the rugby world.
