Why is there a tag limit?
There should be 7 at least.
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Quick analysis of the public data dump to look at the usage of tags in existing questions reveals the following numbers for questions having N tags:
N Questions 1 24926 2 58744 3 73071 4 51859 5 33955
Here's a graph:
The graph looks similar to a normal distribution. It may have a long tail off to the right, suggesting larger numbers of tags might be utilized, but my opinion is that 5 is a sufficient maximum, since the most common number of tags used is 3.
I think that 5 Tags is Okay for 99% of the cases. For example, if I tag my Post "c#" I usually do not need to tag it "c#3.0" unless it really is specifically about C# 3.0, but even then, "C#" is good enough.
At least in my opinion, I found that the 1 or 2 most "prominent" tags for a question are good enough. Unless you really need to write a C# Extension function to SQL Server that has to communicate with an Oracle database over XML using Java as a Proxy, but even that fits in 5 tags (mssql c# oracle java xml).
If you can't accurately sum up the subject matter of your question using 5 tags, then you (and others) must be doing something wrong. I can't think of very many times where I have had to use all 5 tags.
If I am asking a question about how to do something with extending the collections class in ASP.NET I may tag it:
"ASP.NET", "VB", "Collections" "Extending"
And even then I would probably not include "extending" because it on itself isn't a very useful tag (and I would probably mention extending the class somewhere in my title).
If you are still finding that you are using too many tags, you should probably look at simplifying the question until it reaches a certain granularity. Asking a question that is too big and encompasses too many areas at one time is a good way to not get your question answered well by the people.