Your quote doesn’t support your argument. Yes, elements are created out of tags (plus content). But a single tag generally does not constitute an element, except for self-closing tags like <br>.
I agree that it’s a somewhat common mistake to refer to HTML elements as “tags”, but it’s unfortunate to bake that mistake into a language.
If it's common enough it's no longer a mistake, it's just how the English language is. If everyone understands each other, then insisting on a "more correct" usage is just pedantry.
Can you provide a concrete example of a case where this usage would be confusing?
I think it’s better framed as an imprecision than a mistake. The naming language has evolved in common real world usage, in the “can’t put the toothpaste back in the tube” sense of language evolution. As such, it isn’t (any longer) incorrect, only imprecise. It isn’t even necessarily ambiguous, because the usage context tends to disambiguate it.
There are certainly cases where the precision matters, but I think this is only one such case if the imprecision causes misunderstanding by users of the Imba language.
The HTML5 spec does not take a stance on how the words "tag" and "element" should be used in day-to-day speech or in other projects, it just distinguishes them for the purpose of the spec. A specification has to be very precise in its wording, but that doesn't mean we all do all the time.
I agree that it’s a somewhat common mistake to refer to HTML elements as “tags”, but it’s unfortunate to bake that mistake into a language.