The tag system is broken, and is entirely non-functional, and valve is unwilling to pay to hire people to actually curate their fucking storefront, relying entirely on community driven automation. So most of them (and users) just tag it with 'nudity' which if the filter for nudity is enabled, it also catches games like the witcher. Many adult-game developers offer a (barely) censored version with a free non-steam patch to add in nudity.
This is a developer only tag and users cannot tag a game as adult only. They have to voluntarily self-tag their game as adult-only content, which removes it from the default steam page and plummets sales. Yes and no, it's based on a developer tag system.
