Hierarchical Tags, Better File Management

Apple tags support 6 colors and a transparent None tag. You can create custom tag names from these color choices, and you can assign more than one tag to a given file or folder, and Spotlight search for one, or all of the tags by color or custom name.

If you want to perform any hierarchical folder tag management, then you will be into Automator and custom scripting. Although Automator has a Label Finder Items action, it is limited to the basic tag colors, and does not understand custom tag descriptions.

You can send feedback directly to the macOS product team, but do not expect any response.

What do you mean by "hierarchical tags." The idea behind Tags is there isn't any structure.

If you want a structure, you could create Tags such as

Super Category - Tag 1

Super Category - Tag 2

Other Super Category - Tag 1

Super Category - Tag 1 - Potatoes.

I don't know how that would be any better than just tagging the file with Super Category, Tag 1, Potatoes.