The city was expected to host a major event to reward US salesmen and women, which would have injected thousands of pounds into the economy, but now the six-day trip has been cancelled.
Richard Cassini, vice-president of one of the leading special event companies behind the trip, emailed the Lord Provost Sadie Docherty to inform her of the boycott.
Mr Cassini wrote: "I was spearheading an event in Glasgow for 600 business visitors to be guests of your wonderful city.
"We were scheduling six days in Glasgow, three for business and three for leisure time.
"Having read your statement endorsing Hamas and its leadership due to the number of Muslims in your city, I have decided to cancel all plans for our trip.
"We are a Fortune 500 company, so costs were really not a serious consideration, location was.
"Hopefully, the Muslim population that you so sincerely endorse will have the spending power of the very people you have chased away so well."
The council confirmed today that they had received the email but had not yet replied because of the volume of responses to the decision to fly the flag.
A council spokeswoman said: "The council has received more than 1,500 emails/calls/online forms, etc, about the flag and is responding to each."
Mr Cassini insisted his decision to abandon the trip to Glasgow would not be reversed.
Since the above article was posted, a City Council insider has said there is no way of knowing if the email was genuine or a hoax.
Mr Cassini's email was sent from a personal address. He said he was using his personal email so as not to reveal the company he worked for.
Asked by email who he is employed by and what the budget for the booking was, he told the Herald & Times: "I am boarding a flight to California. It would be financially imprudent for me to expose my employer's name.
"All communications were sent as an individual private citizen."
A council spokesman said: "We have no record of anyone planning a trip of this nature. It is likely that we would have heard if such a trip were being planned."
A council insider added: "We do not have any evidence this is not true, nor do we have evidence that it is true."