In his theory of tax equity, Adam Smith brings together ability to pay and benefit approach. The questions of why these two justice principles are positioned side by side in Smith’s fiscal thought and what he intends to achieve are taken up in a broad review of the literature. Smith has taken a step towards a meaningful synthesis of these two principles in the context of his general theory of justice. Smith, however, did not attempt a theorization of both of these principles in themselves and their synthesis. Neoclassical and neoliberal fiscal theory made this synthesis by radicalizing utilitarianism. Once Smith’s theory of tax justice is understood within the entire scope of classical liberalism, the transformation in tax justice brought about by neoliberalism is also revealed more explicitly in this paper. Our study on different countries makes discernible the results we achieved in the foregoing conceptual and theoretical discussion.