The Budget was defeated this evening, with Franco Debono, as promised, joining the Opposition to vote 'no'.
Prime Minister Lawrence Gonzi said he will tomorrow call on the President to advise him when to dissolve Parliament and when to call a general election.
MPs were asked to stand when the votes were taken.
Dr Debono said that his actions were laying the foundation stone of new, modern democracy where everyone was held to account.
Both Prime Minister Lawrence Gonzi and Opposition leader Joseph Muscat will hold press conferences later this evening.
The vote was 35 against and 34 in favour of the Budget.