They are listed in manifest.json and can be organized into two groups — required and optional.
Required permissions are needed at all times. These are:
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"storage" — required to save the notes and options (font type, font size, etc.) to Chrome Storage
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"contextMenus" — required to create My Notes Context menu
Optional permissions are needed only when enabling additional functionality, that depends on one or more such permissions. These are:
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"tabs" — required by Open My Notes in every New Tab (see Options)
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"identity" — required by Enable Google Drive Sync (see Options)
"tabs" is a more powerful permission — the displayed warning may contain an unrelated message — It can: Read your Browsing history.