The decision to join Serbia in a new kingdom was never approved by the Croatian parliament because the new state was not a federal but a non-democratic monarchy under the hegemony of Belgrade, Serbia and its dynasty. In this new state, non-Serb peoples were deprived of their national rights and had greater taxes imposed upon them, all financial investments were made in Serbia, and all of the governments, ministers and generals were approximately 90 percent Serbian.
When the Croats and Croatian Serbs united against Belgrade in 1927, it gave the Belgrade establishment a pretense to arrange the assassination of the Croatian national leaders, with Stjepan Radic at their head, in the parliament in 1928. A year later a direct dictatorship of the king and Belgrade was pro- claimed. Mass persecutions and massacres of Croats began, prompting some of them to escape abroad and establish the Croatian liberation movement. This movement was led by the Ustasha, whose main goal was the destruction of the Serbian state and the creation of a free Croatia. Their leader was Ante Pavelic.
The Communist Party of Yugoslavia also worked on the destruction of the state that was from 1929 called the Kingdom of Yugoslavia. Relations within the country changed after the assassination of King Alexander in Marseilles in 1934, carried out by Macedonian revolutionaries with the assistance of the Croatian Ustasha. The Kingdom of Yugoslavia distanced itself from France and the Europe of Versailles, and moved toward Fascism, while within the country Croats were persecuted and killed more frequently. The Croatian Peasant Party received increasing support, and in 1939 it was able to pressure the Belgrade government to allow the formation of the Banate of Croatia. This arrangement returned autonomy and some attributes of statehood which the Croats lost after unification in 1918. This was a step toward the federalization of the state and a solution to the Croatian question, but all of this was rendered impossible by World War II.