I literally just explained how it's not.
> There are no practical negative consecuences
Assuming an ideal, benevolent government.
(Presumably residing on an infinite frictionless plane, feasting on spherical cows.)
While IDs do have negative consequences, I see zero downside in replacing VATIN, passport number (linked list of "previous document" in worst case, down to birth certificate), army id number, employment record book number and "$surname $name $patronymic, born $birth_date at $birth_place, registered $registration_place" official title with single citizen ID.
I am not arguing for using government-issued IDs for non-government services (as in original post), and consider enforcement of such use a direct attack on citizen freedom, but only for having single ID for use in state-person relations.
Not in all countries. Germany used to have explicit laws against combining state and federal record bases, they were only recently eroded to "fight terrorism".