Illicit tobacco trade poses a major challenge to revenue integrity, public health policy and state capacity across Southeast Asia. While policy debates often link illicit tobacco markets to high excise tax rates, this paper argues that illicit trade is better understood as a structural governance problem shaped by the interaction between tax design, regulation and enforcement capacity. Focusing on six ASEAN economies — Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam — the paper develops a three-pillar framework centred on excise tax structure, regulatory oversight and enforcement systems. The analysis shows that the illicit tobacco trade does not follow a uniform regional pattern. E.g. Indonesia is characterised by domestic evasion and informal production; the Philippines by the benefits and limits of excise reform; Singapore by persistent external supply pressure despite strong enforcement; and Vietnam by brand-specific illicit demand rooted in historical policy choices. Effective control requires predictable, administratively simple tax systems, enforceable regulatory frameworks, stronger supply chain and retail controls, and intelligence-led enforcement supported by cross-border cooperation.