Doesn't necessarily cause damage, the cars slowly losr performance though because of the wear, fitting a new cam usually sees a small power gain.

Bear in mind though the cam wearing is creating swarf, more so when it taps.

If it only taps when cold and then goes quiet thats just the lifters not pumping up properly when the oil is cold/thick. Oil may be too thick (lots of people put thicker oil in to disguise the sound of a worn cam), oil may be dirty, oil ways may be blocked.

Engine flsuh is good although ive never used it on a car with a turbo........always been a bit sceptical.