Mitch McConnell, a US republican senator, said the legislation makes it clear the Palestinian Authority can expect no US help so long as it continues to be led by Hamas.
“The Palestinian people are ill-served by a Hamas-led government that refuses to work toward the betterment of its citizens by failing to renounce terror and work toward peace with Israel,” McConnell said.
The White House said the legislation Bush signed reflects the administration's concern over the current government's failure to renounce violence and terror, recognise Israel and respect previous agreements and obligations.
"We are not going to sit down with people whose objectives are ultimately genocidal"
Stephen Harper, Canadian Prime Minister
Exceptions are made to provide financial support for Mahmoud Abbas, the Palestinian president, who has committed to a negotiated two-state solution with Israel.
Despite the ban on official aid, the United States has provided $468 million in humanitarian aid, delivered by NGOs and in other ways that bypass the Hamas government.
Stephen Harper, the Canadian prime minister, said that Canada will not hold talks with "genocidal" groups such as Hamas to secure Middle Eastern peace.
"We will not solve the Palestinian-Israeli problem, as difficult as that is, through organisations that advocate violence and advocate wiping Israel off the face of the Earth," Harper said.
"It's unfortunate because with Hamas… it has made it very difficult to have dialogue. And dialogue is ultimately necessary to have peace in the long term. But we are not going to sit down with people whose objectives are ultimately genocidal.
"I think all of the civilised world is agreed, and it's not just Canada, we can't deal with organisations whose principle and only objective is terrorism and the eradication of the other side."
Harper's government was the first to withdraw financial aid to the newly-sworn-in Hamas-led Palestinian government in March, ahead of the US.
Canada also suspended its $7.3 million in annual direct aid to the Palestinians, prompting admonition from former US president Jimmy Carter.
The EU and the US also suspended all direct aid to the Palestinian government after the Hamas-led government took power, demanding that they renounce violence, recognise Israel and agree to abide by past peace deals.