In a small bowl, mix together the flour, baking powder and baking soda. Set aside.
In a mixing bowl, cream the butter, sugar and salted caramel sauce on medium speed for 2-3 minutes. It will not get light and fluffy like when you traditionally cream butter and sugar but should have a nice smooth consistency.
Turn the mixer to low and add in the egg and vanilla, mixing until combined. Stop and scrape bowl, then turn mixer onto low. Add the flour mixture and stir until all flour has been incorporated.
Drop batter by tablespoons onto a lightly greased cookie sheet, leaving approximately two inches between cookies. Bake for 10-11 minutes, or until edges are lightly browned.
Remove from oven and allow to cool on cookie sheet for several minutes before moving to a wire cooling rack. Allow cookies to cool completely before frosting.
To finish cookies: Spread desired amount of frosting evenly on each cookie, then drizzle additional salted caramel sauce on top of the cookie.
TO MAKE THE FROSTING:
In a mixer, blend together the butter, caramel sauce and powdered sugar until smooth and frosting holds it's shape when turned off. Add milk one teaspoon at a time to thin if needed. Spread frosting onto cookies, or pipe onto cupcakes if making.