Have you done any experiment or read of any case study to check if too many tags are really damaging the SEO of a website?
The main issue with having too many tags is that CMS such as Wordpress or Blogger will create tag pages similar to category pages which can result to many similar thin content duplicate template pages which can negatively affect your SEO.
However if you are looking to insert many tags to improve the User experience then you can nofollow and noindex the tags pages which will not cause any SEO issues.
TIP: If you use wordpress there are plugins such as All in One SEO & Yoast which options to noindex these type of pages automatically.
According to the Google's Panda Update - Website must have quality content. Websites with low & thin quality content is getting low authority. It says:
Google’s Panda Update is a search filter introduced in February 2011 meant to stop sites with poor quality content from working their way into Google’s top search results. Panda is updated from time-to-time. When this happens, sites previously hit may escape, if they’ve made the right changes. Panda may also catch sites that escaped before. A refresh also means “false positives” might get released.
The following tags are important in SEO:
- Title Tags
- Meta Description Tags
- Heading Tags (H1-H6)
- Italic/Bold Tags
- Meta Keywords Tags
- Image Alt Attributes
- Nofollow Attributes
- Robots Meta Tag
- Schema Markup
- Social Media Meta Tags
- Viewport Meta Tag
Tags will help Search Engine to understand more about website & helps in improving the visibility of website.
Meanwhile unique H1 tag must be used in a page. We can use H2-H6 tags wherever necessary using secondary targeted keywords.