I'm confused by your claims. First, you're telling me sales tax is regressive even though it's proportionate to consumption (the wealthy tend to purchase more, and more expensive goods). Second, you're then asking me accept that closing a tax loophole used primarily by the wealthy makes the sales tax increasingly regressive. How do you figure?
Of course, we can argue this point until we're blue in our faces, but one thing is certain: if we're going to have a tax law, we ought to apply it consistently so that no group may escape it. For the moment, it's politically unfeasible to eliminate the sales tax, so whether I'm tapping away on my iPhone or walking into my local Wal-Mart should make no difference to how I'm taxed.