There was a standard for text encoding (ISO 8859-1), but in practice, users usually used local encodings which is why mojibake is a common problem in ID3v1 tags.
ID3v2.3 allows for “standard” ISO 8859-1 encoding and UTF-16. Unicode strings must begin with the Unicode BOM ($FF FE or $FE FF) to identify the byte order. All numeric strings and URLs are always encoded as ISO-8859-1.
ID3v2.4 also supports UTF-8 (also ISO 8859-1 and UTF-16). v2.4 has not achieved popular status as v2.3!
So don’t use ID3v1 anymore!