OK, I buy cars for my employees, that is a business to business transaction so it would not be tax right? What if I buy grocercies for my employees? What if I buy a house for my employees? If employer provide all essentials to employees, virtually all sales tax could be avoided. You could say the same about only income is taxed, how hard is that? There are billions of transaction each year, the trick will be deciding what is retail and what isn't and how to close loopholes. I would wager everything I have that this will not be an easy task.
No, if you bought groceries for them, that is retail. If you buy a new house or car for them, that is retail. Retail is taxed.