How about Iceland?

Iceland is perfect for Making the Movie

From the New York Times, free reg. req.:

In addition to offering cheap labor and varied vistas, Iceland, like other countries before it, is tempting filmmakers with financial incentives. A rebate program, which pays foreign filmmakers 12 percent of a movie’s production costs in Iceland, has already given more than $ 1.2 million this year – not much in Hollywood, but twice the amount Iceland distributed in all of 2003.

So could Reykjavik be the next Toronto?