Validation error when creating stack with cloudformation

I am creating stack using cloudformation to create a few dynamo tables. The same template and command works with aws, however, it fails with localstack.

This is the error

An error occurred (ValidationError) when calling the CreateChangeSet operation: Template format error: [/Resources/PostTable] Every Resources object must contain a Type member.

This is the logs from localstack docker container

2024-06-09T12:48:03.221 INFO — [et.reactor-0] localstack.request.aws : AWS sts.GetCallerIdentity => 200
2024-06-09T12:48:04.010 DEBUG — [et.reactor-0] plux.runtime.manager : instantiating plugin PluginSpec(localstack.aws.provider.cloudformation:default = <function cloudformation at 0x77c5b3f6c4a0>)
2024-06-09T12:48:04.010 DEBUG — [et.reactor-0] plux.runtime.manager : loading plugin localstack.aws.provider:cloudformation:default
2024-06-09T12:48:04.347 INFO — [et.reactor-0] localstack.request.aws : AWS cloudformation.DescribeStacks => 400 (ValidationError)
2024-06-09T12:48:04.358 INFO — [et.reactor-0] localstack.request.aws : AWS s3.HeadObject => 404 (NoSuchKey)
2024-06-09T12:48:04.371 INFO — [et.reactor-0] localstack.request.aws : AWS s3.PutObject => 200
2024-06-09T12:48:04.384 INFO — [et.reactor-1] localstack.request.aws : AWS s3.GetObject => 200
2024-06-09T12:48:04.390 INFO — [et.reactor-0] localstack.request.aws : AWS cloudformation.CreateChangeSet => 400 (ValidationError)

Hello @accounts_share,

Could you provide us with the CloudFormation template so that we can investigate the issue?
Thanks.

Here

Thank you for the sample.

Currently, this Cfn transformation is not supported in LocalStack CloudFormation | Docs (localstack.cloud).

Please create a feature request on GitHub, and we will investigate the possibility of adding it.

Thank you.

Which transformation exactly? Do you mean,

Fn::Transform:
Name: AWS::Include

?

Also, it is surprising that this is not supported, because this exact template has been working fine with localstack and it suddenly start throwing this error