Jetpack Compose is still a relatively new framework, and as such, some features are not supported yet. As far as I know, the TextToolbar is not supported to be used inside a ModalBottomSheet. This is because the ModalBottomSheet takes up the entire screen, and the TextToolbar is not positioned correctly in this context.
If you need a toolbar for your bottom sheet, I think you have two options :
1. Use a trailing Past icon with textField(easy way that works fine)
2. Create a custom toolbar component that is specifically designed to be used in ModalBottomSheet

Implementing the second way could be a little complex. I tried to implement this method in general.
This is a summary of what my code does:
1. I made a new composable specifically for using inside modal (TextFieldWithCustomToolBar)
2. The new composable has a TextFild and a DropdownMenu which will act instead of native toolbar
3. We need to detect long press on TextFild, Jetpack Compose has modifiers for handling various gestures, including drag, click, and scroll, but it doesn t work directly on text fields. This is because text fields have their own built-in gesture-handling system that intercepts user interactions before they reach the pointer input modifier. So I did it manually by collecting information from interactionSource

@Composable
fun TextFieldWithCustomToolBar(
    supportingText: String,
    onPasteRequested: () -> Unit
) {

    var expanded by remember {
        mutableStateOf(false)
    }
    val text = remember { mutableStateOf("") }
    val interactionSource = remember { MutableInteractionSource() }
    val viewConfiguration = LocalViewConfiguration.current

    //wait for a long press action
    LaunchedEffect(interactionSource) {
        var isDown = false
        interactionSource.interactions.collect { interaction ->
            when (interaction) {
                is PressInteraction.Press -> {
                    isDown = true
                    CoroutineScope(Dispatchers.Main).launch {
                        delay(viewConfiguration.longPressTimeoutMillis)
                        if (isDown) expanded = true
                    }
                }

                is PressInteraction.Release -> {
                    isDown = false
                }
            }
        }
    }
    Box {
        TextField(
            interactionSource = interactionSource,
            value = text.value,
            onValueChange = { text.value = it },
            supportingText = { Text(text = supportingText) }
        )

        DropdownMenu(
            expanded = expanded,
            properties = PopupProperties(focusable = false),
            onDismissRequest = { expanded = false },
        ) {
            DropdownMenuItem({ Text(text = "Paste") }, onClick = {
                expanded = false
                onPasteRequested.invoke()
            })
        }
    }
}