> For example for the most part there were multiple religions allowed.

Mussolini didn't really care about religion. He only made Catholicism the state religion because he thought that by doing so he could buy the Catholic Church's support; which only partially worked, it continued to be somewhat of a thorn in his side for the remainder of his rule. In seeing religion primarily as a tool to be manipulated to political ends, as opposed to being driven by personal religious belief, Mussolini actually has a lot in common with ancient Roman politicians, many of whom had a very similar attitude towards religion. If the end policy result seems quite different, that is more due to differences in historical circumstance than a fundamentally different ideological starting point.

And just like fascist Italy, ancient Rome had a state religion, and everyone had to pay lip service to it – the state didn't care if you believed in it in your heart, but criticising it publicly could get you killed. Much of the ancient Roman persecution of Jews and Christians was because they refused to pay lip service to the state religion, and dared to express their disbelief in the state's Gods publicly rather than privately. Likewise, Fascist Italy didn't care if you sincerely believed in Catholicism – Il Duce himself didn't – so long as you publicly pretended to believe in it. The primary difference is that the Roman state religion, being polytheistic, was often willing to import foreign gods - although the government reserved the right to decide in each individual case whether a given importation was to be permitted or prohibited, and a number of foreign cults were indeed banned – while Catholicism as (a branch of) an exclusively monotheistic religion generally isn't willing to do that (although it has some history of importing figures from other religions as Saints – the Gautama Buddha was accepted into Catholicism as Saint Josaphat, but he was later dropped as a Saint once his non-Christian origin became clear–although some of the Eastern Orthodox churches still have him as one; many argue that the Irish Saint Brigid is a Christianisation of the Irish Goddess Brigid; others argue that Our Lady of Guadalupe is a Christianisation of the Aztec Goddess Tonantzin, although that is somewhat more disputed.)

Was fascist Italy a totalitarian state? It officially claimed to be one – when the liberal opposition used "totalitarian" as a pejorative, Mussolini decided to reclaim the epithet and wear it proudly ("yes, we are totalitarian, totalitarianism is great!") – but Mussolini never gained absolute power: the King and the Church acted as independent spheres of power, and Mussolini never managed to gain as much control over either as he wished – when Hitler asked Mussolini to join World War II on the Axis side, Mussolini had to ask the King for permission, and was told "No" several times before Victor Emmanuel eventually said "Yes". Mussolini's position in Italy was always much weaker than Hitler's in Germany or Stalin's in Russia (or even Franco's in Spain), and while fascist Italy did persecute political dissidents, the persecution was far milder than that of the Nazis or Stalinists. (I'm not defending Mussolini here, who undoubtedly was a bad person who did numerous evil things and brought his country to near-ruin – but in many ways a lesser evil than Hitler or Stalin.)