Steps to recreate https://core.trac.wordpress.org/ticket/57300

cpt-and-taxo.php

<?php

declare( strict_types=1 );

function wporg_register_my_custom_post_type() : void {
	register_post_type( 'my_custom_post_type', [
		'label'               => __( 'My Post Type', 'wporg' ),
		'labels'              => [ 'name' => _x( 'My custom post type', 'Post Type General Name', 'wporg' ) ],
		'supports'            => [ 'title', 'editor' ],
		'hierarchical'        => true,
		'public'              => true,
		'show_ui'             => true,
		'show_in_menu'        => true,
		'menu_position'       => 5,
		'menu_icon'           => 'dashicons-admin-post',
		'show_in_admin_bar'   => true,
		'show_in_nav_menus'   => true,
		'exclude_from_search' => false,
		'has_archive'         => true,
		'taxonomies'          => [ 'my_taxonomy' ],
		'can_export'          => false,
		'capability_type'     => 'page',
		'show_in_rest'        => true,
	] );

	register_taxonomy( 'my_taxonomy', [ 'post', 'my_custom_post_type' ], [
		'labels'            => [ 'name' => _x( 'My custom taxo', 'Taxonomy Name', 'wporg' ) ],
		'hierarchical'      => true,
		'public'            => true,
		'show_ui'           => true,
		'show_admin_column' => true,
		'show_in_nav_menus' => true,
		'show_tagcloud'     => true,
		'show_in_rest'      => true,
		'rewrite'           => [ 'hierarchical' => true ],
	] );
}
add_action( 'init', 'wporg_register_my_custom_post_type', 10 );