Nevermind, I found a saved game (luckily not TOO far back) and this time I immediately accepted his offer and it got me into act 3 (hallelujah!!)

On a lark, I decided to try something. I reloaded from the point of just when I reappeared in the Shaman's cellar, and decided not to even talk to Tax. I just walked out of the basement without talking to him at all. Walked around, cleaned up a few outstanding quests, went to the battlefields and back; then after picking up all the loot (there's a tremendous bunch of loot in those two locked chests where the imp told you that you'll never get them opened, keys now on the floor), I talked to Tax. I immediately chose yes, and it proceeded normally again. I think you have to follow the standard progressive choices once you do talk to him, but until you do, it's OK to explore.

Thanks for the suggestion though <img src="/ubbthreads/images/graemlins/smile.gif" alt="" />

Ralph