The development of compact radio frequency identification (RFID) tag is the key requirement for wireless tracking of precious small size goods/packages in transport. A design of compact meander line tag antenna having inductive coupling feed is presented for RFID system operating at ultra high frequency band of 865–867 MHz. The size of the proposed tag antenna is 43 mm × 10 mm, and is designed using Higgs 4 IC chip (made Alien Technology, USA) having impedance of 20.55 − j191.45 Ω at centre frequency 866 MHz. The antenna characteristics such as impedance, radiation pattern, bandwidth, and effect of ground on gain and tag size are analyzed and found to closely match with the simulated values. The observed value of reading range varies from 87.5 to 35 cms depending on mounting on non-metal and metal packages, respectively.