http://www.livejournal.com/support/faqbrowse.bml?faqid=102 All this about custom friends groups, and no mention of tagging!
Current:
After adding some or all of the people on your Friends list to custom friends groups, you can use these groups to restrict who can see an entry and to filter your Friends page.
Proposed:
After adding some or all of the people on your Friends list to custom friends groups, you can use these groups to restrict who can see an entry, filter your Friends page, and to [226]restrict tagging permissions[/link].