It looks like a duplicate of old issue https://github.com/localstack/localstack/issues/78
But now it's reproducible for me with the latest version of LocalStack. 
def test_api_gateway_sqs_integration_with_event_source(self):
        
        aws_stack.create_sqs_queue(self.TEST_SQS_QUEUE)
        
        result = connect_api_gateway_to_sqs(
            'test_gateway4',
            stage_name=self.TEST_STAGE_NAME,
            queue_arn=self.TEST_SQS_QUEUE, path=self.API_PATH_DATA_INBOUND)
        
        self.create_lambda_function(self.TEST_LAMBDA_SQS_HANDLER_NAME)
        add_event_source(
            self.TEST_LAMBDA_SQS_HANDLER_NAME,
            aws_stack.sqs_queue_arn(self.TEST_SQS_QUEUE),
            True)
        
        test_data = {'spam': 'eggs & beans'}
        url = INBOUND_GATEWAY_URL_PATTERN.format(
            api_id=result['id'],
            stage_name=self.TEST_STAGE_NAME,
            path=self.API_PATH_DATA_INBOUND
        )
        result = requests.post(url, data=json.dumps(test_data))
        self.assertEqual(result.status_code, 200)
        parsed_content = parseString(result.content)
        root = parsed_content.documentElement.childNodes[1]
        attr_md5 = root.childNodes[1].lastChild.nodeValue
        body_md5 = root.childNodes[3].lastChild.nodeValue
        self.assertEqual(attr_md5, '4141913720225b35a836dd9e19fc1e55')
        self.assertEqual(body_md5, 'b639f52308afd65866c86f274c59033f')
    def test_api_gateway_sqs_integration(self):