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The costs are externalized yes but in many of these cases the person losing some privacy also benefits.

Smoking might cure anxiety but that doesn’t mean it doesn’t give you lung cancer...

So people shouldn't be allowed to smoke if they want to?

If they want that’s fine but it’s damaging behaviour for society so it will be taxed and/or regulated.

The reason it is taxed is because they can get away with it.

I assume you live in a country without free medical care? I don’t.

I live in a country with tax funded healthcare.

That's another way of saying the same thing. Taxing bad behaviour pays for their healthcare then.