[‘type aliases’ can only be used in a .ts file]

This is what you need to do with VS Code, observe the gif carefully

Steps to resolve error
1. Go to extension
2. Click on more (...) and select Show Built-in extension
3. Search "TypeScript and JavaScript Language Features" - yellow & blue icon
4. Click on Setting icon of extension and select Disable (workspace)
5. Click on Reload / Restart Required