Video: Hollywood hot spot

By Reporter
CNBC
updated 5/31/2006 1:42:39 PM ET 2006-05-31T17:42:39

It’s not Canada or New Zealand, but Iceland. A country offering a variety of landscapes, everything from glaciers to beaches, is now attracting some of the biggest names in the movie business. Originally a place Hummer came to film commercials, Iceland is now a major destination for feature films –including the upcoming “Flags of Our Fathers”, directed by Clint Eastwood – a story set in Japan.

Iceland’s own film industry is also benefiting from the exposure. Now home to two film festivals and an increasing number of homegrown filmmakers, Iceland is even seeing Oscar nominations come its way. But its not just the 18 hours of daylight and versatile landscape that’s attracting filmmakers - there are major tax incentives as well.

"The minister of industry came up with a 12% -- we're trying to push it to 15 or 17% of reimbursement. That definitely has increased a lot of interest to come and shoot here", says Laufey Jonsdottir, of the Icelandic Film Institute.

After films wrap production, producers are then entitled to receive a percentage of their costs back from the Icelandic government.

"Its been going on for about 5 years, and its been quite a good trial period. About 11 million dollars paid in back taxes so far," says Jonsdottir.

But Hollywood isn’t the only one taking advantage of these benefits. India, Europe and even Chinese filmmakers are taking their productions to Iceland, which means you’ll be seeing a lot more of the film industry’s best kept secret – until now.

© 2012 CNBC, Inc. All Rights Reserved

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