In a medium bowl, whisk together the flour, baking soda and salt; set aside.
Using a stand mixer or hand mixer, cream together butter, peanut butter, 1/2 cup granulated sugar, and brown sugar until smooth, scraping down the side of the bowl if necessary.
Add the egg, milk and vanilla extract. Beat until combined. Add the flour mixture and mix on low until just combined. Don't over mix.
Wrap the dough in plastic wrap and chill in the refrigerator for at least 30 minutes. Can be chilled for up to 72 hours. Place the Hershey's Kisses in the freezer so they are frozen when you put them on the cookies. This will help the kisses to keep their shape and not melt.
When ready to bake, preheat oven to 350 degrees F. Line a large baking sheet with a Silpat baking mat or parchment paper.
Roll the peanut butter cookie dough into balls, about 1 tablespoon of dough per cookie. Place the remaining 1/2 cup sugar in a small bowl. Roll the cookie dough balls in the sugar until they are generously coated.
Place the cookie dough balls onto the prepare baking sheet, about 2-inches apart. Bake the cookies until they start to crack on the edges, about 8 or 9 minutes. Remove the baking sheet from oven and lightly press a frozen chocolate kiss into the center of each cookie, allowing it to crack slightly. Return to oven and bake for an additional 2 minutes. DON'T over bake! You want the cookies to stay soft and you don't want the kisses to melt too much.
Remove from the oven and let the cookies cool on the baking sheet for 2 to 3 minutes. Transfer to a cooling rack and cool until the kisses harden. If you want to speed up the process, you can put the cookies in the freezer so the kisses will harden faster.
Store the cookies in an airtight container for up to 4 days.