Members of parliament oust technocrat Prime Minister Tihomir Oreskovic, raising the prospect of a snap election.
Croatian politicians have voted to dissolve parliament, paving the way for a snap election after bringing down the fragile five-month old government last week.
The dissolution of parliament “will become effective on July 15”, speaker Zeljko Reiner said on Monday.
The move was backed by 137 deputies in the 151-seat assembly.
The election is likely to happen in early September, as it must be held no earlier than 30 days and no later than 60 days after the date when parliament is dissolved.
President Kolinda Grabar-Kitarovic, who will choose the election date, said she would take account of the fact that most parties were in favour of holding the vote after the summer holidays.
Analysts say a snap election may not solve the political impasse that has prevented Croatia from getting a stable government capable of carrying out reforms needed to fix fragile public finances and improve the investment climate.
The right-wing government led by technocrat Prime Minister Tihomir Oreskovic, a former pharmaceutical executive with no party affiliation, fell after only five months in power.
Cobbled together after indecisive November polls, the fragile coalition was beset by internal disputes between the main party, HDZ, and its junior partner, Most, amid concerns over Croatia’s shift to the right.
The political crisis escalated last month with a conflict of interest affair involving Tomislav Karamarko, the powerful HDZ head and deputy premier.
A national ethnics watchdog ruled last week that Karamarko had a conflict of interest owing to a business deal between his wife and a lobbyist for Hungary’s oil group MOL.
MOL is currently in arbitration with Croatia over its national oil group INA, in which it is a major shareholder.
Amid growing disputes, HDZ filed a no-confidence motion against Oreskovic.
They accused the premier of trying to boost his own political power instead of dealing with the economy as he had pledged – accusations he firmly rejected.