Darden Restaurants

says the new tax reform will save $70 million — and it plans to spend $20 million of that on employees.

Restaurant companies are joining the corporate chorus rushing to praise the tax bill Congress passed last month as Orlando-based Darden Restaurants said the legislation will save it about $70 million.

Olive Garden and LongHorn Steakhouse parent company Darden Restaurants said the new changes will cut taxes by about $70 million in the third quarter.

The Orlando-based restaurant chain said Monday the tax cut will prompt it to spend an additional $20 million on its 175,000-plus employees this year, but did not give specifics. Darden said its effective tax rate will drop from 25 percent to 18 percent going forward.

Darden is one of several companies rallying around the tax bill Republicans passed in December and went into law Dec. 22. Last week, airlines Southwest and American said they would give bonuses to some employees because of savings from the bill. Comcast, Boeing and AT&T also announced one-time bonuses. AT&T also confirmed layoffs for about 600 employees last month.

The tax bill cut the top corporate tax rate from 35 percent to 21 percent.

In its last fiscal year, Darden paid $154.8 million in income taxes on a profit of $479.1 million. Darden has about 1,700 restaurants.

“One of the best investments we can make is in our people,” said a statement from CEO Gene Lee. “During the remainder of fiscal 2018, we will invest approximately $20 million in initiatives directly benefiting our workforce. This investment will strengthen one of our most important competitive advantages – a results-oriented culture – as we continue to improve on the guest experience, and position Darden and our brands for longterm success.”

Darden spokesman Rich Jeffers said the company was not giving further details on the employee initiatives for competitive reasons.

With its eased taxes, Darden raised its fiscal outlook for the year by about 25 cents a share to $4.70 to $4.78.

It is just one of several restaurant companies touting the benefits of the tax overhaul package.

Ruth’s Hospitality Group chief operating officer Arne Haak said the tax changes will also benefit the Winter Parkbased parent of Ruth’s Chris Steak Houses.

“The tax reform is very good for us,” Haak said at this week’s ICR Conference, a gathering of restaurant and retail industry companies in Orlando.

The tax bill will allow Brazilian steakhouse chain Fogo de Chao, which is based in Dallas, to lower its tax rate and bring money back from overseas, said chief financial officer Tony Laday. “We are an international company — we do have operations in Brazil — and we were prohibited from a tax perspective from bringing some of that cash back home,” Laday said at the ICR Conference. “There’s a net benefit from the tax perspective and greater flexibility from a tax perspective.”

U.S. companies are sitting on about $3.1 trillion in profits held overseas, according to data from Bloomberg. The tax bill created a one-time transfer tax of 7.5 percent for liquid assets and 14.5 percent for illiquid assets.

But some companies are also pointing out that repatriating that money will result in a larger tax bill this year. Investment firm Goldman Sachs said the bill would increase its tax liability by $5 billion for 2017.