Since language is now declared to be a synonym of multilingual (see screen dump below), I assume that this has been resolved and there isn't supposed to be a difference. Fine!
However, this is only a start. IMHO, the "language"-related tags in the tag wiki needs to be re-thought. In addition to language and multilingual, there are translation, localization, internationalization, i18n and locale.
The last two are supposed to be about two specific modules. The i18n tag is used correctly (most of the time). However, few of the questions tagged locale is about the (core) locale module. Many users use this tag for questions about PHP
setlocale() - or for general questions about localization and internationalization.
As for the other language-related tags, they seem to be applied more or less interchangeably.
The current tag description of localization, says that localization is:
usually related to translating content
I find this description unfortunate, because it differs from the industry's standard definition. Localization is about catering for regional differences and regional technical requirements (e.g. currency, units for weights and measures, character set, timezone, and translation). Maybe some bold editor can change the description into something that makes it less a synonym of "translation"?
Usually "localization" and "internationalization" are regarded synonyms. Not so here, where internationalization (no description) seems to be used as yet another synonym for multilingual.
I suggest internationalization is made a synonym of localization, and that the tag description of localization is improved.
(Some may argue that these are not synononyms. However, I do not think ordinary users know enough about this to be able to distinguish between these two closely related and overlapping terms.)
Then, keep i18n and locale - but try to enforce that they should only be used for questions about the respective modules.
That leaves translation. Like language I think it just should become a synonym of multilingual.