Still not working. Have tried with three different users.
Bug report filed...
Update: The in-app purchase promo code did not work until AFTER I released the app for sale.
This does not appear to follow expected behavior. From App Store Connect documentation:
To request promo codes for an app version, the version’s status must be Ready for Sale, Pre-Order Ready for Sale, or Pending Developer Release for iOS and macOS apps, or Ready for Sale or Pre-Order Ready for Sale for tvOS apps. For in-app purchases, the in-app purchase state must be Approved or it won't appear as an option.