The main requirements for tool identification systems embrace tool identification, the storing of tool orientated data, and non-contact reading and writing (dynamically, statistically and destination routing). Further important aspects are small dimensions, high noise immunity, and minimum service. These requirements are satisfied by inductive identification systems. The code tags are small and need no current feed. By offering increased storage capacity and simple connection of the processing unit to modern control systems they represent a trendsetting aid for tool management tasks.