Permissions error sorting files into new folders

Yes, it's not existent on the Mac and resolves to the empty string. See this topic from the documentation for a list of available placeholders:

To be sure it's not related to a sandboxing issue, can you try this command via Terminal.app while Mp3tag being closed:

defaults delete app.mp3tag.Mp3tag SecurityScopedBookmarks

After that, load the folder (not the individual files) via ⌘O and see if the issue persists.