Its actually a pretty simple fix. open your settings.json file then add this to get the intellisense working on all files

"tailwindCSS.includeLanguages": {
    "html": "html",
    "javascript": "javascript",
    "css": "css"
},
"editor.quickSuggestions": {
    "strings": true
}

Support and improvements for TailwindCSS v4 are in progress. As of the fix in TailwindCSS Intellisense VSCode extension since February 2025 (v0.14.3), it is possible to specify the new CSS-first configuration as a configuration file.

Due to the proper v4 configuration detection, Intellisense will work the same way as in v3 without any additional settings. It remains compatible with both v3 and v4 versions simultaneously.

• tailwindlabs/tailwindcss-intellisense PR #1167: Clarify how the configFile option works with v4

Tailwind CSS v4.x (CSS entrypoints)

For v4 projects, specify the CSS file(s) that serve as your Tailwind entrypoints.

If your project contains a single CSS entrypoint, set this option to a string:

"tailwindCSS.experimental.configFile": "src/styles/app.css"

For projects with multiple CSS entrypoints, use an object where each key is a file path and each value is a glob pattern (or array of patterns) representing the files it applies to:

"tailwindCSS.experimental.configFile": {
  "packages/a/src/app.css": "packages/a/src/**",
  "packages/b/src/app.css": "packages/b/src/**"
}

Additionally, it no longer displays an error message if the configuration file is missing in v4.

• tailwindlabs/tailwindcss-intellisense PR #1164: Don't create v4 projects for CSS files that don't look like v4 configs

The VSCode extension can also be used for v4 projects that are not installed via NPM. This is important because the extension determines whether you are using v3 or v4 in your project based on the NPM package version by default. From now on, it can also detect the version for other installation methods (i.e., even without a package-lock.json).

• tailwindlabs/tailwindcss-intellisense PR #1157: Allow v4.0 projects not installed with npm to use IntelliSense

Since TailwindCSS no longer supports Sass, Less, or Stylus preprocessors from v4 onwards, the Intellisense extension will also not consider them starting from v4.

• tailwindlabs/tailwindcss-intellisense PR #1159: Ignore preprocessor files when looking for v4 configs

I think you almost got it... i added this to my settings and it worked.
what you are missing (in my opinion) is "inlineSuggest" - full snippet here:

"editor.quickSuggestions": {
   "strings": true
},
"css.validate": false,
"editor.inlineSuggest.enabled": true

Yup. Writing tailwind in vscode presents itself as error prone but compiles fine. No good solution out there for @apply that I’ve seen in vscode marketplace

Tailwind CSS IntelliSense extension doesn't work until you have a configuration file in your workspace, as its description clearly states!

You'll be fine even if you're just using the CDN, but you have to create a tailwind.config.js file in your project's root directory, containing the defaults at least:

module.exports = {
    content: ["./src/**/*.{html,js}"],
    theme: {
        extend: {},
    },
    plugins: [],
};

Also, and since you're working with Laravel, I guess you need to add Blade files to be recognized by the extension through this VSC setting (in settings.json):

"tailwindCSS.includeLanguages": {
    "blade": "html",
},

Moreover, this extension can offer intellisense in CSS files. So such files need to be binded too:

"files.associations": {
    "*.css": "tailwindcss",
},

One final note: The content paths are what going to be processed by Tailwind's JIT engine; understanding it is crucial!

Update: In my current setup, it also won't work until I run the project folder as a "VSC workspace".