Taxable and Non Taxable Non PO lines on the same PO/Invoice

How do you setup a Purchasing line type to indicate that a PO line should be taxable or non taxable?  We are trying to get tax running in our Payables module but we have a scenario where our buyers are entering taxable (goods) and non taxable (services) lines on the same Purchase Orders, but when they come up on the invoice both lines are showing up as taxable.

Can I setup the purchasing line types so that anything that has a Service line type does not calculate tax?

Thank you

Wade Simon