It seems like code coverage is not affected if we remove tests, which actually causes coverage to drop. Since the coverage check only considers new lines of code, we get a false positive when the quality gate passes.
It is important for us to keep our coverage up and not have the ability to drop it by removing tests.
In the context of a pull request, the current gate will not fail if code coverage decreases. This feature request (linked above) proposes a quality gate that ensures certain metrics, such as code coverage, can only improve (i.e., coverage can only increase and not decrease) as a result of changes.