Yes. Each tax in the Tax Rates catalog (Settings > Billing & Invoices > Tax Rates) that applies to the invoice total (Invoice Total - Services or Invoice Total - Expenses) has its own Exemptions list.
Add the Activity Types or Expense Item Types you want to exclude to a tax's Exemptions list. Billed amounts for those items are excluded from that tax's taxable base, while the rest of the invoice continues to be taxed normally. An item can be exempt from one assigned tax while remaining taxable under another. For example, an item can be exempt from PST but still be subject to GST.
You can also continue to use Tax 1/2/3 at the item level or the 0%-tax phase approach when you want to control taxability directly for an activity or expense type. Check out this article for more: Taxes in BQE CORE.