State tax is showing on non taxable service

[edudflog]

Joomla 2.5.8
VM 2.0.18a

As our company has a physical location in New Jersey, I have created a tax rule called NJ Sales Tax.  It is only charged on Products shipped to the state of New Jersey in the US. 

It is set up as Tax per Bill, +%, 7(%), US Dollars, it includes all product categories except one (gift Cards - since they are not taxable), Shoppers Group is left blank, United States, New Jersey, not visible for shoppers or vendors.

For my  "$25 gift cards", I have not applied this NJ tax rule, but instead set the tax rule as "Apply No Rule", however in the cart, NJ Tax is still being calculated and shown.  How do I get the gift cards to discontinue showing NJ tax?

I tried using tax per product as the arithmetic operation however when I did that, no tax showed up in the cart for any products.

Then, as a workaround, I tried setting up a tax rule called "Gift Card Tax Credit" which calculated a -7% tax on gift cards but although I only applied that to the tax rule for Gift Cards, all products being shipped to NJ were being shown with this credit applied in the cart.

This appears to be a serious bug for anyone using Virtuemart in the US to sell Gift Cards, as gift cards are classified a financial instrument and are non taxable, yet tax is showing up on their purchase in NJ because of the NJ State tax rule I've applied to products there (I have not applied the NJ tax rule to gift cards).  Potential buyers see the tax being charged and are confused as to why.  This means lost business.  Maybe the administrators might want to take a look at this problem that so far seems unsolvable.

I would appreciate any assistance.

Thanks