HTML was based on SGML, but HTML 5 is explicitly not SGML anymore and specification calls the format "inspired by SGML". So to be fully conformant you need a custom processor instead of being able to use standard tools.
HTML5 doesn't cease to be based on SGML by a browser cartel with the express intent to transform the web into JavaScript-heavy web apps declaring so. WHATWG isn't an accredited standards body so what they declare a "standard" or "conformant" means shit. Especially if they don't bother to actually publish a standard that doesn't change all the time. Their "living standard" thing is at best a collaborative Wiki space of sorts where (a closed group of) "browser vendors" attempt to agree on how to do things, and is falling apart lately. WHATWG's "standard" has witnessed the web becoming a Chrome monopoly, and Opera and MS to cease browser development altogether.
SGML is the only game in town able to parse (a significant part of) HTML based on an actual standard, and is also the only realistic perspective for folks interested in the web as a standardized communication medium going forward.
HTML was "based on" SGML only in the sense that it borrowed a lot from SGML. However in practice it was never an application of SGML. HTML4 tried its best to move developers to SGML based HTML but devs ignored it.
HTML5 recognises that there was this gulf between the specification and the actual usage and sided with real world usage.
