As we go down the hierarchy the characters into consideration increases. For example, Kingdom Animalia includes all the multi-cellular, eukaryotic organism which does not have the cell wall. As we go down to Phylum level, criteria become whether they have cellular, tissue or organ level of organization.
As we move from kingdom to species common characters increase. As we are going down the hierarchy by moving to the species level.
But the increase in common character does not explain the increase in complexity of classification. Complexity is rather an evolutionary trait.
So, the correct option is 'Both Assertion and Reason are correct but Reason is not the correct explanation for Assertion'.