In a large bowl, whisk together flour, baking powder and salt.
In another large bowl, using electric mixer on high speed, beat butter and sugar until light and fluffy, about 3 minutes. Beat in egg and then vanilla.
Reduce mixer speed to low and gradually add flour mixture, mixing just until incorporated. Divide dough into 4 portions. Keep portions wrapped in plastic while coloring.
Working with 1 portion at a time, add a couple of drops green food coloring to dough and mix until fully incorporated. (Tip: Tint slightly darker than you desire; cookies will bake up lighter.) Roll between 2 sheets of parchment paper to 1/8 inch thick. Chill until firm, 30 minutes in refrigerator or 15 minutes in freezer. Repeat with remaining dough.
Heat oven to 350°F. Line baking sheets with parchment paper. Using floured cookie cutters, cut out cookies. Place on prepared sheets. Reroll, chill and cut scraps.
Bake, rotating positions of baking sheets halfway through, until cookies are light golden brown around edges, 10 to 12 minutes. Let cool on sheets 5 minutes before transferring to wire racks to cool completely.
Use royal icing to “glue” cookies together in tree shapes with stars at top and chocolate caramels as trunks. Dust with confectioners’ sugar if desired.