It sure is for small service businesses. That is, if services aren’t taxed, there may not be a tax added onto that, but regular supplies and such are fully taxable unless the organization is run as a nonprofit. Take a look at how much the modern consumer is paying out of their total expenditures to such providers.
Yes, but what you wrote at first simply isn’t true with respect to “supply chain.” I’m in the service biz too, and I’m the end consumer of toner, paper, and pencils. The sales tax is another business expense, and is offset against my income for income tax purposes.
(I suggest buying more stuff by mail order to avoid sales taxes.)