For example, in states with a sales tax, businesses have to handle the tax collections, the paperwork, and administration. In some states, they get a very small fee to compensate them for the extra costs, but it seldom covers the expenses (been there, done that). Essentially, this makes the business owners underpaid tax collectors for the state. Is that right? Business owners have to comply with tons of bureaucrat mandated paperwork with no compensation whatsoever. Is that right?

If a business clearly marks on the entrances that it is a smoking establishment, then potential customers are free to decide whether or not to patronize the business. Likewise, potential employees are free to decide whether or not to apply for employment there. What's wrong with that? In my case, I would neither patronize the business nor work there, but that's my choice. It isn't a matter of libertarian fantasy, it's a matter of respecting the right of individuals to make decisions for themselves without compulsion from the government.*

*And yes, I would extend that right to other things, too, even if I personnally disagreed with their choices such as to use drugs in private.