I got this error while importing WooCommerce sample products. There is no other plugin installed or activated.
Sorry, this file type is not permitted for security reasons.
This is due to the WP 5.0.1 security patches. It’s a known issue on trac.
I’m experiencing the same problem with Local 3.0.3 and Wordpress 5.0.3.
Is there a workaround or a fix yet? I couldn’t find the issue tracker that @afragen mentioned.
This happens for me with basic jpg and png files, too.