Is it possible to send a newsletter specifically to paid members?

Simply put in the subject line. It seems that newsletters are now membership agnostic.

Yes, if you’re on Ghost <4.5.0 then you can select just paid members to send to:

And on >=4.5.0 the same feature is there but the interface is a little different:

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And does the latter feature utilize tags of the members?

It utilises Stripe subscription status in the case of “Paid members”. You can choose a particular label to send to in the newer version too.

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