PISA, Italy — Giorgia Meloni doesn’t want to be beaten at her own game.

With an election approaching next year and a new far-right rival emerging, the Italian prime minister — whose political origins lie in Italy’s post-fascist right — is putting aside the moderate image she has built over her four years in office and hardening her tone on migration and security.

Meloni’s government was the first in the EU to attack the Spanish government over a sudden influx of migrants from Morocco into the Spanish exclave of Ceuta last week. 

While France and other countries tightened border checks, Italy went further and announced it had suspended the EU’s free-movement Schengen agreement with Madrid. Now, in Italian airports, passengers from Spain are asked to join a different line. 

Meloni’s office has made clear it has no intention of lifting the controls until at least Aug. 15, escalating the clash with Spain, which retaliated by imposing checks on travelers from Italy.

“We will not back down one millimeter on illegal immigration,” Meloni posted on X while her allies attacked the socialist Spanish government, accusing it of failing to manage migration flows. “Defending our borders, stopping human traffickers, and ensuring effective repatriation will continue to be this government’s policy,” she added.

The clash with Spain is just the latest sign that the Italian leader is doing all she can to secure her core, hard-right electorate in the face of a challenge from the right by Roberto Vannacci, a former general and member of the European Parliament.

With an election expected as early as next spring, Vannacci’s far-right National Future party has been advancing in the polls, overtaking one of Meloni’s coalition partners, the far-right League party, and gaining on another, Forza Italia, according to POLITICO’s Poll of Polls. 

For Meloni, who began her political career in the youth wing of Italy’s post-fascist movement, the challenge strikes particularly close to home.

“There is no doubt that there is concern about containing the competition from National Future,” said Marco Tarchi, a leading right-wing political scientist. “It all boils down to a sharpening of tone. The issues — security, immigration, identity — remain the same as before.” 

During the electoral campaign that brought her to power in 2022, Meloni promised to crack down on illegal migration by putting in place a naval blockade off Italy’s coast. Though that project never ultimately happened, Meloni’s government did open detention hubs in Albania to house migrants while their asylum applications are processed. 

Vannacci, who is campaigning on security and a hard line on immigration, is calling for a more radical solution: “remigration” — a yet-to-be-detailed plan to encourage migrants to return to their countries of origin.

The crisis in Ceuta, during which tens of thousands of migrants crossed from Morocco into the Spanish exclave and nearly 100 died, provided Meloni with an opportunity to show that fighting irregular migration remains an absolute priority for her government.

Meloni’s reaction was “purely the result of domestic political calculations,” said Giorgio Gori, a member of the European Parliament from the left-wing Democratic Party. The Italian prime minister is trying to secure her electorate “by showing that she is loyal to the right-wing slogan and propaganda on migration and beyond.”

For Giovanni Orsina, director of the political science department at Rome’s Luiss Guido Carli University, Meloni’s priority at this stage is “that the Brothers of Italy [Meloni’s party] doesn’t start losing votes too” — in preparation for a potential alliance with Vannacci before or after next year’s election.

“Vannacci has been growing a lot in polls, especially over the past two months,” said Lorenzo Pregliasco from the YouTrend polling firm, noting that National Future is polling at over 7 percent. 

“Without Vannacci, the center-right could lose the upcoming election,” he said. “These seven points matter a lot.”

The Vannacci effect

Nicola Procaccini, Meloni’s lieutenant and co-chair of the European Conservatives and Reformists (ECR) group, denies that Meloni is shifting on policy to protect herself from Vannacci.

“She stands where she has always stood,” he told POLITICO. “She simply isn’t the racist, xenophobic fascist she was made out to be when she first took office. And she isn’t one now, either.” 

Meloni is also facing a challenge to her support for Ukraine, with both the League and Vannacci advocating a softer line on Moscow, opposing military aid to Kyiv and arguing against an increase in defense spending. 

Though Meloni has portrayed herself as a strong backer of Ukraine, her reliance on the League for support has meant Italy has contributed just €3 billion in four years, roughly the equivalent of €1 a month for every Italian citizen, less than the cost of an espresso.

Italy has also declined to join NATO’s PURL (Prioritized Ukraine Requirements List), an arms-buying scheme set up last summer after U.S. President Donald Trump ended new military aid commitments to Kyiv.

Ukraine is where Meloni’s real difference with Vannacci lies, argued Tarchi, who teaches at the University of Florence and is considered the key figure of a movement called the New Right.

“Otherwise, the gap is artificially exaggerated in rhetoric and posturing for tactical reasons,” he said.

Meloni’s allies haven’t ruled out an alliance with Vannacci but they stress that the possibility will depend on where he stands on key values such as foreign policy.

If he seeks “to position Italy, alongside Russia, China, Iran, and North Korea, clearly, it is not possible to stand together,” said Procaccini. “If, instead, he chooses the West — the democracies, Western nations, Western liberal democracies — then we can certainly stand together.”

Brussels is bracing for an unusual fight between the EU’s smallest country and a British ex-footballing legend.

Peter Shilton, the England goalkeeper who conceded the “Hand of God” goal from Diego Armando Maradona in 1986, has started a new life as an anti-gambling advocate after overcoming a decades-long addiction.

Despite being a diehard Brexit supporter, he’s become the poster boy of the European Parliament’s push to tax online betting in a bid to raise some much-needed funds to finance the bloc’s next €2 trillion budget.

But the campaign has run into strong opposition from Malta. The tiny island in the Mediterranean Sea, with a population of just over half a million people, is home to a burgeoning betting sector. It says that higher taxes will cripple its gambling industry, boost illegal operators and drive firms outside the bloc.

“[Malta] will not accept the introduction of any EU-level taxes designed to sustain the bloc’s spending,” the country’s Prime Minister, Robert Abela, told the Maltese Parliament in June.

But Shilton, who lost more than £1 million in betting on horse racing over 45 years and now runs his own gambling addiction charity, dismisses the arguments by Malta and the gambling lobbies as “window dressing.” He’s in favor of higher taxes as he wants to shrink advertising revenue that is used to lure in new gamblers.

“Deep down they’re after everybody’s money. Simple as that,” he told POLITICO during a visit to Brussels in June.

The topic has split the EU’s 27 governments, pitting gambling-heavy Southern European countries against their more supportive Western European peers, led by France. Capitals are already fighting even though the Commission hasn’t yet issued a formal proposal for the possible tax, which would ultimately need to be unanimously approved by governments.

It’s one of numerous budget battle lines being drawn, with Ireland — which is steering the talks as chair of the rotating Council presidency — set to restart negotiations to facilitate an overall deal on the EU budget before the end of the year.

That’s no mean feat given Dublin’s task to mesh competing spending priorities into a single budget — financing everything from farmers’ subsidies to foreign aid — that is acceptable for each of the EU’s 27 governments.

National capitals will have to unanimously approve new EU-wide taxes — known as own resources — to pay for soaring defense spending and post-Covid debt repayments if they want to avoid drastically increasing national contributions to Brussels.

Supporters of the gambling levy point to the fact that it would rake in over €13 billion throughout the next budget cycle and — for some, more importantly — address a serious public health issue. An estimated 80 million adults globally have experienced a gambling addiction, according to experts.

“We look on it [gambling] as an illness. It’s something that’s inborn in you and that can be ignited,” Shilton said.

Malta’s game plan

Malta has invested heavily in the gambling industry — including lotteries, betting and casinos increasingly operating online — which now accounts for around 12 percent of its gross domestic product.

These firms have relocated to Malta because of its light-touch licensing regime, business-friendly tax regime and balmy weather.

The country is “as dependent on the online gambling industry as Germany is on cars,” said an EU diplomat, granted anonymity to speak freely.

While gambling firms need local authorization to operate in most other European countries, securing the Maltese license is crucial to access banking services and gain a foothold in the EU market.

Malta-based firms dominated the German and Austrian online gambling markets before national regulators cracked down. This has prompted the Maltese government to refuse to recognize some court rulings and sanctions issued by other EU countries against its gambling firms.

Given its influence, it is hardly surprising that the gambling industry has found a friendly ear among Malta’s politicians in Brussels.

The Maltese president of the European Parliament, Roberta Metsola, last year gave the opening speech at an international gambling conference in Rome that also featured Italian Foreign Affairs Minister Antonio Tajani.

“I’m more than a little proud that it started in my island home of Malta,” she said, referring to SiGMA, a Maltese events company that focuses on online gambling founded by Eman Pulis, a university friend of Metsola.

Betting lobbies say they oppose higher gambling rates on the grounds that they will fuel appetite for the illegal market, away from the grasp of EU rules.

“A higher tax would lead to worse odds for the customers … and it is relevant because access to the illegal markets in Europe is, obviously, one click away,” said secretary general of the European Gaming and Betting Association, Maarten Haijer.

Nicola Matteucci, an economist at the Università Politecnica delle Marche in Italy who has undertaken extensive research on the gambling sector, argued there is a “point where prices exceed a certain level and the demand [for gambling] diminishes. But it’s not as immediate as suggested by the industry.”

Matteucci said that most gamblers will be undeterred by slightly higher taxes and worse odds as they are not fully rational consumers.

Anti-gambling groups reason instead that higher taxes will reduce the sector’s spending on commercials, preventing would-be punters from getting sucked in to gambling in the first place.

“Higher taxes will therefore mean less gambling advertising overall and many people would regard that as a public benefit,” said Derek Webb, the founder of the Campaign for Fairer Gambling advocacy group.

Club Med joins Malta

Malta has joined forces with fellow Mediterranean countries — Italy, Portugal and Spain — to challenge the mooted tax which was first proposed by the Parliament’s socialist lawmaker Victor Negrescu, said four diplomats with knowledge of the discussions.

According to the European Commission’s estimates, seen by POLITICO, a 3 percent tax on the net turnover of the online gambling sector would generate an estimated €1.9 billion per year.

With its big online gambling market, Spain is expected to be among the biggest financial losers, should the tax go ahead. It is estimated to be on the hook for €414 million per year, almost a quarter of the total amount. That compares to a projected bill of €165 million per year for Malta— a disproportionality high amount for such a small country.

Portugal is also reluctant to back the levy. It fears that higher taxes would eat into revenue brought in by state-run betting and lotteries that is currently channeled to the charity Santa Casa da Misericórdia de Lisboa‘s healthcare and youth support programs, said a Portuguese official.

Meanwhile, given the relatively low uptake of online gambling, Italy’s misgivings have surprised anti-betting advocates. Rome is expected to pay a mere 7 percent of the proposed new levy — a significantly lower proportion than its regular EU budget contributions.

However, Prime Minister Giorgia Meloni’s Brothers of Italy party has previously been receptive to the gambling industry. Last year its MPs passed a resolution encouraging the reversal of a ban on professional football clubs advertising gambling firms.