Cafe Sasha
Juan Ruiz de Alarcon #1
In front of the Hotel Los Arcos
This place has a very nice, alternative atmosphere. The staff is friendly and you can sit at the small balcony and have some drinks. It is really interesting, because Taxco itself seems to be a little bit more old-ish. But here you can find your small alternative part of the city. Also you can find vegetarian food here.
Cafe Chipotle de Balbas
After the highly recommended Cafe Balbas closed due to a fire the owner focused on his new cafe. They serve everything from sandwiches to crepes to full dinner meals, as well as alcohol if coffee doesn't do it for you. Especially the salads are well-known. The terrace in the back overlooking the mountains and the city is beautiful. Prices are cheap, around $60 pesos at most for any item, many are in the $35-range.