This is a crucial feature. Its absence makes you sometime double or even triple time on certain things.
Say you do a literature review or prep a database for whatever. You have a main tag or folder for this subject, and then subfolder or extra precision tags
For instance: Scroll down a whole list, rank papers as major / medium impact factor / to be negliged. If you have papers inside the general subject that have two tags on them (A and B or B and C) -- if you decide to rank them sub-tag by sub-tag (say A on monday, B on tuesday!), once you are done with A, you'd end up with papers you have already ranked showing up inside category B, cluttering up your workflow by having to check each time if it has this tag inside which you already ranked all the papers, or if it has been classified in the "major article" tag/folder...which itself isn't long, but adds up if you have hundreds. Especially since the "folders" are small and gray, and even more so because if you have numerous tags or folders, it might get harder to pick them out of the lot.
Extra precision: Say you are done with category A. Tuesday you do B but only get to ranking 100/300 papers. The next day you want to start where you were before, so you scroll down the list thinking that when you see papers tagged, you were already up to there....this task will get hellish if there is a random alternance of papers that are ranked and unranked because you already did it inside tag A. You will have to carefully and slowly scroll by checking each one, making sure they are all tagged, until you get to wherever in your list, where none are tagged. A task which will need to be repeated EVERY time you pull up the list because only 20 papers can be loaded at a single time. Of course, the way around it is to create a "bookmark" tag --> but this is a manual fix that complicates things so not ideal.
And in before the answer: yes but why don't you rank them inside the whole subject instead of by sub-tag --> the point is that the more malleable the options are, the more users are happy. Sometimes you need to divide and order your work in a certain fashion -- and you can't have your reference manager blocking your work in this way.
I hope this all makes sense, had to type it in a rush because going to work