diff --git a/google-cloud-spanner/lib/google/cloud/spanner/client.rb b/google-cloud-spanner/lib/google/cloud/spanner/client.rb
index f39c009..6c4a107 100644
--- a/google-cloud-spanner/lib/google/cloud/spanner/client.rb
+++ b/google-cloud-spanner/lib/google/cloud/spanner/client.rb
@@ -2227,11 +2227,11 @@ def transaction deadline: 120, exclude_txn_from_change_streams: false,
             request_options, tag_type: :transaction_tag
 
           @pool.with_session do |session|
+            transaction_tag = request_options[:transaction_tag] if request_options
             tx = session.create_empty_transaction \
-              exclude_txn_from_change_streams: exclude_txn_from_change_streams, read_lock_mode: read_lock_mode
-            if request_options
-              tx.transaction_tag = request_options[:transaction_tag]
-            end
+              exclude_txn_from_change_streams: exclude_txn_from_change_streams,
+              read_lock_mode: read_lock_mode,
+              transaction_tag: transaction_tag
 
             begin
               Thread.current[IS_TRANSACTION_RUNNING_KEY] = true
@@ -2289,11 +2289,9 @@ def transaction deadline: 120, exclude_txn_from_change_streams: false,
               tx = session.create_empty_transaction(
                 exclude_txn_from_change_streams: exclude_txn_from_change_streams,
                 previous_transaction_id: previous_transaction_id,
-                read_lock_mode: read_lock_mode
+                read_lock_mode: read_lock_mode,
+                transaction_tag: transaction_tag
               )
-              if request_options
-                tx.transaction_tag = request_options[:transaction_tag]
-              end
               retry
             rescue StandardError => e
               # Rollback transaction when handling unexpected error
diff --git a/google-cloud-spanner/lib/google/cloud/spanner/session.rb b/google-cloud-spanner/lib/google/cloud/spanner/session.rb
index 74c9cc0..d1a1557 100644
--- a/google-cloud-spanner/lib/google/cloud/spanner/session.rb
+++ b/google-cloud-spanner/lib/google/cloud/spanner/session.rb
@@ -1488,17 +1488,24 @@ def rollback transaction_id
         # @param exclude_txn_from_change_streams [::Boolean] Optional. Defaults to `false`.
         #   When `exclude_txn_from_change_streams` is set to `true`, it prevents read
         #   or write transactions from being tracked in change streams.
+        # @param request_options [::Hash, nil] Optional. Common request options.
+        #   Example option: `:priority`.
         # @private
         # @return [::Google::Cloud::Spanner::Transaction]
-        def create_transaction exclude_txn_from_change_streams: false, read_lock_mode: nil
+        def create_transaction exclude_txn_from_change_streams: false, read_lock_mode: nil,
+                               request_options: nil
           route_to_leader = LARHeaders.begin_transaction true
+          request_options = Convert.to_request_options request_options, tag_type: :transaction_tag
+          transaction_tag = request_options[:transaction_tag] if request_options
           tx_grpc = service.begin_transaction path,
                                               route_to_leader: route_to_leader,
                                               exclude_txn_from_change_streams: exclude_txn_from_change_streams,
+                                              request_options: request_options,
                                               read_lock_mode: read_lock_mode
           Transaction.from_grpc \
             tx_grpc, self,
-            exclude_txn_from_change_streams: exclude_txn_from_change_streams, read_lock_mode: read_lock_mode
+            exclude_txn_from_change_streams: exclude_txn_from_change_streams, read_lock_mode: read_lock_mode,
+            transaction_tag: transaction_tag
         end
 
         # Creates a new empty transaction wrapper without a server-side object.
@@ -1512,12 +1519,15 @@ def create_transaction exclude_txn_from_change_streams: false, read_lock_mode: n
         #   An id of the previous transaction, if this new transaction wrapper is being created
         #   as a part of a retry. Previous transaction id should be added to TransactionOptions
         #   of a new ReadWrite transaction when retry is attempted.
+        # @param transaction_tag [::String, nil] Optional.
+        #   A tag used for statistics collection about this transaction.
         # @private
         # @return [::Google::Cloud::Spanner::Transaction] The new *empty-wrapper* transaction object.
         def create_empty_transaction exclude_txn_from_change_streams: false, previous_transaction_id: nil,
-                                     read_lock_mode: nil
+                                     read_lock_mode: nil, transaction_tag: nil
           Transaction.from_grpc nil, self, exclude_txn_from_change_streams: exclude_txn_from_change_streams,
-previous_transaction_id: previous_transaction_id, read_lock_mode: read_lock_mode
+                                previous_transaction_id: previous_transaction_id, read_lock_mode: read_lock_mode,
+                                transaction_tag: transaction_tag
         end
 
         # If the session is non-multiplexed, keeps the session alive by executing `"SELECT 1"`.
diff --git a/google-cloud-spanner/lib/google/cloud/spanner/transaction.rb b/google-cloud-spanner/lib/google/cloud/spanner/transaction.rb
index 75518a1..c1b219d 100644
--- a/google-cloud-spanner/lib/google/cloud/spanner/transaction.rb
+++ b/google-cloud-spanner/lib/google/cloud/spanner/transaction.rb
@@ -124,13 +124,17 @@ class Transaction
         #   An id of the previous transaction, if this new transaction wrapper is being created
         #   as a part of a retry. Previous transaction id should be added to TransactionOptions
         #   of a new ReadWrite transaction when retry is attempted.
+        # @param transaction_tag [::String, nil] Optional.
+        #   A tag used for statistics collection about this transaction.
         # @private
         # @return [::Google::Cloud::Spanner::Transaction]
-        def initialize grpc, session, exclude_txn_from_change_streams, previous_transaction_id: nil, read_lock_mode: nil
+        def initialize grpc, session, exclude_txn_from_change_streams, previous_transaction_id: nil,
+                       read_lock_mode: nil, transaction_tag: nil
           @grpc = grpc
           @session = session
           @exclude_txn_from_change_streams = exclude_txn_from_change_streams
           @read_lock_mode = read_lock_mode
+          @transaction_tag = transaction_tag
 
           # throwing away empty strings for simplicity
           unless previous_transaction_id.nil? || previous_transaction_id.empty?
@@ -1253,12 +1257,14 @@ def mutations
         #   An id of the previous transaction, if this new transaction wrapper is being created
         #   as a part of a retry. Previous transaction id should be added to TransactionOptions
         #   of a new ReadWrite transaction when retry is attempted.
+        # @param transaction_tag [::String, nil] Optional.
+        #   A tag used for statistics collection about this transaction.
         # @private
         # @return [::Google::Cloud::Spanner::Transaction]
         def self.from_grpc grpc, session, exclude_txn_from_change_streams: false, previous_transaction_id: nil,
-                           read_lock_mode: nil
+                           read_lock_mode: nil, transaction_tag: nil
           new grpc, session, exclude_txn_from_change_streams, previous_transaction_id: previous_transaction_id,
-read_lock_mode: read_lock_mode
+              read_lock_mode: read_lock_mode, transaction_tag: transaction_tag
         end
 
         ##
@@ -1297,6 +1303,7 @@ def safe_begin_transaction! exclude_from_change_streams: false, request_options:
             return if existing_transaction?
             ensure_session!
             route_to_leader = LARHeaders.begin_transaction true
+            request_options = build_request_options request_options
 
             # TODO: [virost@, 2025-10] fix this so it uses tx_selector
             # instead of re-creating it within `Service#begin_transaction`
@@ -1377,7 +1384,7 @@ def tx_selector exclude_txn_from_change_streams: false, read_lock_mode: nil
 
         ##
         # @private Build request options. If transaction tag is set
-        #   then add into request options.
+        #   then add it to the request options.
         def build_request_options options
           options = Convert.to_request_options options, tag_type: :request_tag
 
diff --git a/google-cloud-spanner/test/google/cloud/spanner/client/transaction_tag_test.rb b/google-cloud-spanner/test/google/cloud/spanner/client/transaction_tag_test.rb
new file mode 100644
index 0000000..dbe2373
--- /dev/null
+++ b/google-cloud-spanner/test/google/cloud/spanner/client/transaction_tag_test.rb
@@ -0,0 +1,99 @@
+# Copyright 2026 Google LLC
+#
+# Licensed under the Apache License, Version 2.0 (the "License");
+# you may not use this file except in compliance with the License.
+# You may obtain a copy of the License at
+#
+#     https://www.apache.org/licenses/LICENSE-2.0
+#
+# Unless required by applicable law or agreed to in writing, software
+# distributed under the License is distributed on an "AS IS" BASIS,
+# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+# See the License for the specific language governing permissions and
+# limitations under the License.
+
+require "helper"
+
+describe Google::Cloud::Spanner::Client, :transaction, :mock_spanner do
+  let(:instance_id) { "my-instance-id" }
+  let(:database_id) { "my-database-id" }
+  let(:session_id) { "session123" }
+  let(:session_grpc) { Google::Cloud::Spanner::V1::Session.new name: session_path(instance_id, database_id, session_id), multiplexed: true }
+  let(:session) { Google::Cloud::Spanner::Session.from_grpc session_grpc, spanner.service }
+  let(:transaction_id) { "tx789" }
+  let(:transaction_grpc) { Google::Cloud::Spanner::V1::Transaction.new id: transaction_id }
+  let(:default_options) { ::Gapic::CallOptions.new metadata: { "google-cloud-resource-prefix" => database_path(instance_id, database_id) } }
+  let(:client) { spanner.client instance_id, database_id }
+  let(:tx_opts) { Google::Cloud::Spanner::V1::TransactionOptions.new(read_write: Google::Cloud::Spanner::V1::TransactionOptions::ReadWrite.new) }
+  let(:commit_time) { Time.now }
+  let(:commit_timestamp) { Google::Cloud::Spanner::Convert.time_to_timestamp commit_time }
+  let(:commit_resp) { Google::Cloud::Spanner::V1::CommitResponse.new commit_timestamp: commit_timestamp }
+
+  it "passes transaction tag to BeginTransaction when transaction_id is called lazily" do
+    mock = Minitest::Mock.new
+    spanner.service.mocked_service = mock
+    
+    mock.expect :create_session, session_grpc, [{ database: database_path(instance_id, database_id), session: default_session_request }, default_options]
+
+    # This is the call we are testing. It should have the transaction_tag.
+    expected_tx_opts = Google::Cloud::Spanner::V1::TransactionOptions.new(
+      read_write: Google::Cloud::Spanner::V1::TransactionOptions::ReadWrite.new(
+        read_lock_mode: :READ_LOCK_MODE_UNSPECIFIED,
+        multiplexed_session_previous_transaction_id: ""
+      ),
+      exclude_txn_from_change_streams: false,
+      isolation_level: :ISOLATION_LEVEL_UNSPECIFIED
+    )
+
+    mock.expect :begin_transaction, transaction_grpc, [{
+        session: session_grpc.name, 
+        options: expected_tx_opts, 
+        request_options: { transaction_tag: "Tag-1" },
+        mutation_key: nil
+      }, default_options]
+
+    mock.expect :commit, commit_resp, [{
+      session: session_grpc.name, 
+      mutations: [], 
+      transaction_id: transaction_id, 
+      single_use_transaction: nil,
+      request_options: { transaction_tag: "Tag-1" },
+      precommit_token: nil
+    }, default_options]
+
+    client.transaction request_options: { tag: "Tag-1" } do |tx|
+      # Calling transaction_id triggers safe_begin_transaction!
+      id = tx.transaction_id
+      _(id).must_equal transaction_id
+    end
+
+    mock.verify
+  end
+
+  it "passes transaction tag when calling Session#create_transaction explicitly" do
+    mock = Minitest::Mock.new
+    spanner.service.mocked_service = mock
+    
+    expected_tx_opts = Google::Cloud::Spanner::V1::TransactionOptions.new(
+      read_write: Google::Cloud::Spanner::V1::TransactionOptions::ReadWrite.new(
+        read_lock_mode: :READ_LOCK_MODE_UNSPECIFIED,
+        multiplexed_session_previous_transaction_id: ""
+      ),
+      exclude_txn_from_change_streams: false,
+      isolation_level: :ISOLATION_LEVEL_UNSPECIFIED
+    )
+
+    mock.expect :begin_transaction, transaction_grpc, [{
+        session: session_grpc.name, 
+        options: expected_tx_opts, 
+        request_options: { transaction_tag: "Tag-1" },
+        mutation_key: nil
+      }, default_options]
+
+    tx = session.create_transaction request_options: { tag: "Tag-1" }
+    _(tx).must_be_kind_of Google::Cloud::Spanner::Transaction
+    _(tx.transaction_id).must_equal transaction_id
+
+    mock.verify
+  end
+end