Both 'man diff' and 'diff --help' refer to the parameter --tabsize as
follows:

--tabsize=NUM  Tab stops are every NUM (default 8) print columns.

But this seems to be broken:

$ echo -e "\t\tfilea" > filea; echo "\t\t\tfileb" > fileb; diff
--tabsize=4 filea fileb
diff: option `--tabsize' doesn't allow an argument
diff: Try `diff --help' for more information.

Other variations do not work either:

$ diff --tabsize 4 filea fileb
Segmentation fault (core dumped)

I have tried these commands with both POSIXLY_CORRECT=1 and with it
unset, it appears to make no difference.  This is with the latest
version of diffutils:

$ cygcheck -c diffutils
Cygwin Package Information
Package              Version        Status
diffutils            2.8.4-1        OK

My output of "cygcheck -svr" is attached.

Brian