BEAT butter, sugar, honey, egg and vanilla in large bowl with electric mixer on medium speed until well blended. Add flour, baking powder, baking soda and salt; mix well. Cover. Refrigerate at least 2 hours.

PREHEAT oven to 350°F. Place dough on lightly floured surface; roll out to 1/4-inch thickness. Cut into desired shapes with 2-1/2- to 3-inch floured cookie cutters. Trace smaller version of each cookie shape on dough, leaving 1/2- to 3/4-inch border of dough. Cut out and remove dough from center of each shape; set aside. Place cutouts on baking sheets covered with foil. Shape remaining dough into ball; re-roll to make additional cutouts.

CRUSH each color of candy separately between 2 layers of wax paper with mallet. Spoon crushed candy inside centers of cutouts.

BAKE 6 to 8 minutes or until candy is melted and cookies are lightly browned. Cool cookies completely before removing from foil.