Cut tofu into strips 1-inch strips. To a bowl, add all of the ingredients for the marinade- cumin, smoked paprika, chili powder, garlic powder, salt, black pepper, lime juice, 2 tablespoons olive oil, and water. Mix until a paste has formed.
Add the tofu strips one by one into the marinade and coat all sides. It's easier to use your fingers. Let the tofu marinate in the bowl for 30 minutes if time allows.
Heat ½ tablespoon olive oil in a cast-iron skillet or a large frying pan. Once hot, add the tofu and cook over medium heat for 3-4 minutes on each side, until golden brown. You may need to do this in two bathes. Once ready, remove from the pan and set aside.
To the same skillet, heat ½ tablespoon olive oil and add the peppers and onion, and season with a pinch of salt and black pepper to taste. If there is any leftover marinade from the tofu, add it as well. Stir and cook the veggies for 6-7 minutes, until soft but still crunchy.
Add the tofu to the vegetables and gently mix. Remove from the heat, top with fresh chopped cilantro or parsley, and more lime juice if desired. Serve warm with flour tortillas or with cooked rice!