Currently, for manufacturing UHF RFID passive tags, the online inspection mechanism is very simple. This mechanism tries to read tag IDs in the near field, and hence validates tag’s usability. For UHF RFID applications, tag usability is a very rough indicator and cannot characterize the performance of a tag accurately. In practice, effective reading distance is the key performance index of a tag. This study proposes chip’s turn-on power approach to characterize the effective reading distance of UHF RFID passive tags. The experimental results presented in this paper demonstrated the feasibility of this approach. Moreover, in comparison with the large-scale setup, this mini-scale setup produces a smaller error in the estimation of the effective reading distance. Using a mini anechoic chamber, the mini-scale setup can be adopted in practice for online tag performance inspection to grade tag’s compliance with effective reading distance.