BEAT butter, sugar, dry pudding mix and egg in large bowl with mixer until well blended. Mix remaining ingredients. Gradually add to pudding mixture, beating well after each addition. Refrigerate 1 hour or until firm.
HEAT oven to 350°F. Roll out dough on lightly floured surface to 1/4-inch thickness. Cut into gingerbread shapes with 4-inch cookie cutter. Place, 2 inches apart, on greased baking sheets. Use straw to make hole near top of each cutout.
BAKE 10 to 12 min. or until edges are lightly browned. Let stand on baking sheets 3 min. Remove to wire racks; cool completely. Decorate as desired. Insert ribbon through holes to hang cookies on tree.