how tax is linked to intended use in requisition in r12

The user is selecting the classification code from intended use LOV when creating requisition. The user requirement is to have both recoverable and non recoverable VAT to be Zero. The classification code they select should give 0 VAT but only non recoverable tax is 0. We need to find out the reason to check how it is picking up tax. The tax rules are not defined in the system as well.