The man in the white shirt knows he has a great deal of power. He's playing by rules that nobody on Ove's street can control or change, and Ove's anger stems in part from the unfairness of this. The man's cigarettes are also a slap in the face to Ove and his love of rules. Smoking is likely not illegal, but the way the man goes about it is certainly not following general codes of conduct that dictate how a person should dispose of their trash appropriately.