A tag is a label that you can add to your inventory entities or objects in your vSphere system. You can use tags to capture a variety of metadata about your vSphere inventory and to organize and retrieve objects quickly. You can assign or remove tags for your workload domains, clusters, and hosts in the SDDC Manager UI.
VMware Cloud Foundation supports association of tags to maintain the inventory entities in the system. This feature provides an integrated tagging functionality that allows you to perform an unified tagging across the entire landscape of elements in the SDDC deployment. When you create tags in the SDDC Manager UI for a specfic object and if the same object is present in the vCenter Server, then those tags are in sync with each other and you can see them in the vCenter Server as well.
If you assign a host to a workload domain which is part of ELM cluster, its tags are updated on the respective vCenter Server.