Just follow the instructions in the dialog at the top left of your image.

On the line below the No Tax line, enter a tax code in the Code column eg. H, then hit Enter or as the instructions indicate, double-click the H.  Then fill out how you want the tax code to calculate the tax.  When you are done, it will bring you back to this screen and will usually fill in a description for you.  You can then edit the description if you wish.  The customer sees this description.

Thanks.  this is what I came up with:

Thanks.  this is what I came up with: