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Hi @nkkowa
Unfortunately this is a side effect of what I'd consider a bug in VS Code, where extension-contributed icons are treated differently from the builtin ones. I originally raised this in microsoft/vscode#154492 but it seems that VS Code folks aren't too keen to address that.
I tried to play with various different paddings and margins in the SVG, but I wasn't able to align it in any way. I think the best course of action would therefore be contributing the HCL icon into seti-ui, so they both use the same styling rules.
The new icon is a bit big and doesn't line up well with other icons. Perhaps standardize with the spacing from the Terraform extension.
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