The “Update as Paid” option will create a pre-tagged bank transaction for you, so it’s likely the one you’re seeing the “Tag me!” option for is a duplicate.
What I would suggest doing is deleting the untagged entry (seems the invoice has been tagged using the above method), and then carrying out a bank recon against your online banking account just to ensure your bank balance is correct. There’s a guide on how to do this here: Reconciling your bank