Sounds like Prohibition but for cigarettes. We know how that went. We also know what banning marijuana hasn't worked out too well. At the start of Covid pandemic South Africa banned the sales of cigarettes for about three months. Result was lots of unscrupulous people became rich [0][1].
Isn't there a big difference between what Australia is doing and those prohibitions?
I think one of the main reasons those went so terribly is that people were already used and/or addicted to drinking/smoking, so of course they continued doing those things illegally. But this policy tries to make sure that people never start smoking, by making it not legally available to every who is now young enough to most likely not have started already. Those who smoke currently can (with this policy) continue doing so legally, so there's less demand for black markets etc.
I can't fault the theory and can only share an anecdote. It was illegal for school children to smoke when I was in school, 80s into early 90s. So much so that kids caught smoking were expelled from school. Kids still smoked. Perhaps it was a different time and perhaps this time it is being done right.
[0]https://businesstech.co.za/news/trending/468724/governments-... [1]https://www.africanews.com/2022/06/17/cigarette-smuggling-th...