I tried that and it didn't work. There are just 2 choices in "Module settings" - Discount or Default Matrix. But look at the code from the template:
I mean module settings that appear when you edit delivery methods, not E-shop module settings. Have you created a new pricing matrix for delivery?
I just tested my method and everything works fine - the tax 6.5% is added to the incoming price automatically, and the delivery rate is $2. It is displayed in order form and is added to the total amount to pay.
I'm not active on the forum anymore. Please contact other forum staff.