The Collaborative International Dictionary of English v.0.48:

Taffy \Taf"fy\, n. [Prov. E. taffy toffy.]
   1. A kind of candy made of molasses or brown sugar boiled
      down and poured out in shallow pans. [Written also, in
      England, toffy.]
      [1913 Webster]

   2. Flattery; soft phrases. [Slang]
      [1913 Webster]

WordNet (r) 3.0 (2006):

taffy
    n 1: chewy candy of sugar or syrup boiled until thick and pulled
         until glossy