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What is the size of the cyst? Does your vet not feel he can remove the cyst and that is why he wants to remove the tail?
You may want to make sure the vet just can't scoop out the cysts and save the tail. Cysts are just like sticking a balloon under the skin...you can keep draining, but if you don't remove the shell/lining of the cyst..they come back.
If your vet doesn't think it is possible, you may want to seek a second opinion at another vet office...and you may want to find a vet that has a laser. In my clinic we have a laser and I can laser the cyst lining.
Just remember it is a chronic sourse of possible infection if it is constantly drained.