Preheat your oven to 350°F and line baking sheets with parchment paper.
In a large bowl, cream together the butter and granulated sugar until light and fluffy, about 3 minutes.
Beat in the egg and vanilla extract until well combined.
In a separate bowl, whisk together the flour, baking powder, and salt. Gradually add the dry ingredients to the wet ingredients, mixing until just combined.
Pour the sparkling sugar into a shallow bowl. Roll the dough into 1-inch balls, then roll each ball in the colored sugar until completely coated.
Place the balls 2 inches apart on the prepared baking sheets. You can leave them round or gently flatten them slightly with the bottom of a glass.
Bake for 10-12 minutes, or until the edges are just set. The centers should still look slightly soft.
Cool on the baking sheet for 5 minutes before transferring to a wire rack to cool completely.