I actually faced the same issue while trying to do the same with navigation split view instead of the navigation view. And I think this is a bug with swiftUI, because it was working fine when I tried the same design pattern in UIKit.

But I found a hack to resolve this bug in the navigation split view:

attach the below modifiers consecutively to the tabview(which is inside the sidebar part)

.navigationSplitViewColumnWidth(500), .frame(499)

the first modifier applies to the left column of the NavigationSplitView and the second modifier applies to the tabview...

BUT using tabview inside navigationSplitview/NavigationStack comes with its own set of problems, for eg: nav bar items applies to the whole parent view instead of each tab.