Foselone,
External fungal infections (Saprolegnea) are virtually non-existent in marine aquariums. Besides, you'd be able to see the hyphae.
dman, what about the white spots on the fish's forehead and at both nostrils? Do those seem normal to you? I can't tell from the photo, but those spots don't look right either. Regarding the lesion, does it look like a growth coming up from inside the fish's gill chamber? Is the fish a long-term captive?
I've seen smooth red lesions protruding from the gills of fish that were suffering from thyroid hyperplasia (goiter). Most cases are caused by iodine defficiency, but there are also goiter-causing compounds that can be present, and of course tumors can cause these as well. That said, I have NEVER seen that problem in a tang being kept in a reef tank before.
JHemdal