Inclusive tax method means that tax is already included in the price. Exclusive tax method means that tax is not included in the price and should be calculated/added separately.
For example:
Product Price 100 and Tax 10%
Inclusive tax method: Price 90.91 and Tax amount: 9.09 = 100 (total price with tax) Exclusive tax method: Price 100 and Tax amount: 10 = 110 (total price with tax)