We use the identity:
\[
\sec^2 \theta = 1 + \tan^2 \theta.
\]
Expanding the given expression:
\[
\sec^4 \theta - \tan^4 \theta = (\sec^2 \theta + \tan^2 \theta)(\sec^2 \theta - \tan^2 \theta).
\]
Since,
\[
\sec^2 \theta - \tan^2 \theta = 1.
\]
\[
\sec^4 \theta - \tan^4 \theta = (\sec^2 \theta + \tan^2 \theta) \times 1.
\]
\[
= \sec^2 \theta + \tan^2 \theta.
\]
Using \( \sec^2 \theta = 1 + \tan^2 \theta \), we get:
\[
1 + 2\tan^2 \theta.
\]