I don't think smoking should be banned and that I believe that the government is not in charge of making sure everyone is pressured into being healthy.
But, "let people consume what they want" is, just, sooo naive.
this is the right angle, though I would've gone elsewhere with the rest of the post.
regulation of smoking, soda, etc, etc arises from a fundamental tension. 'society' as a whole faces negative consequences when people make unhealthy decisions. yet we all recognize that at a certain level, forcing people to make healthy decisions in contrary to liberty at a fundamental level. nobody wants to see smokers executed or the obese fed steamed broccoli at gunpoint.
so, the question always is, where to draw the line. the most convenient answer for the politicians is to tax the product at point of sale. tobacco taxes are extremely regressive. a sugar tax would be regressive, albeit less so.
I would argue that tobacco taxes have crossed a line from disincentive to actual punishment in the West. given how regressive they are, and the inelasticity of product demand, the average pack-a-day smoker in NYC or Providence has gone from spending $2000/yr on cigarettes to $4500 or so. that's a heavy, heavy burden to bear, for, say, a single mother with a working poor level income.
Smoking cigarettes does impose an "external burden" like you said, coming from secondhand smoke, mooching on health insurance policies, and improper disposal of butts having a negative impact on the environment.
Other people who aren't the smoker will have to bear the costs of the secondhand smoke health effects (which people can moan and groan that you can just walk away, it IS unavoidable), insurance costs that increase with more sick people, and cleanup efforts (40% of coastal trash California cleans up are cigarette butts, and animals, particularly birds, will eat cigarettes because they think it's food, then die from malnutrition).
So I'd say the question is: does the smoker deserve to pay "punishment" level cigarette taxes to make up for the costs imposed elsewhere?