In 1497 John Cabot, a Venetian, unfurled in North America, probably at Labrador, the first English flag.
Cabot and his three sons sailed from Bristol with letters patent from Henry VII of England, “to set up the royal banners and ensigns in the countries, places, or mainland newly found by them, and to conquer, occupy and possess them, as his vassals and Lieutenants.”
Lorenzo Pasqualigo, under date “London 23 August 1497” writes to his brothers in Venice that “Cabot planted in his newfound land a large cross with a flag of England and another of St. Mark, by reason of his being a Venetian, so that our banner has floated very far afield.” The royal ensign of Henry VII used by Cabot was the Cross of St. George flag also known as the Flag of England, which is a white flag with a rectangular red cross extending its entire length and breadth.

The Massachusetts Cross of St. George Flag
The Cross of St George flag, according to the records was used in the Massachusetts Bay Colony in 1634, if not before. Mention is also made that in that year complaint was made that:
The ensign at Salem had been defaced by Mr. Endicott cutting out one part of the red cross.”
Roger Williams was the cause of the agitation.
The case was construed into one of rebellion to England on the complaint of Mr. Richard Brown, ruling elder of the church at Watertown, before the Court of Assistance. The Court issued an attachment against Ensign Richard Davenport, then the ensign bearer of Salem, whose colors had been mutilated, to appear at the next Court which was not held until a year after his flag was so mutilated. It was then shown that the mutilation was done, not from disloyalty to the flag, but from a conscientious conviction that it was idolatrous to allow it to remain.”
Endicott was found guilty of a great offence, having committed “by his soul authority an act giving occasion to the Court of England to think ill of them.” For this indiscretion, he was not allowed to hold any public office for one year.
Two months later the provincial authorities again discussed the lawful use of the cross in the ensign and opinions on the subject being divided, the matter was deferred until another meeting in March when Mr. Endicott’s opinion was asked. At this meeting, no better decision could be arrived at, and the subject was referred to the next General Court, orders being given by the Commissioners for Military Affairs that in the meantime all ensigns should be laid aside.
In the interim, letters were sent to England reporting these discussions and suggesting another ensign. This was disapproved of, and resulted, December 1635, in the Military Commissioners appointing colors for every company, leaving out the cross in all, and requesting that the King’s Arms should be put into them, and in the colors of Castle Island.

King’s Colors
It was customary for all ships in passing the fort at Castle Island in Boston Harbor, to observe certain regulations. After these occurrences, much misunderstanding and dissension arose, however, between the authorities and captains of ships from England, and the former, fearing reports might be carried to the Mother Country that they had rebelled, asked the advice of the captains of the ten remaining ships then in the harbor. They recommended the use in the fort at Castle Island, of the “KING’S COLORS” and it was finally concluded by the authorities that although they were of the decided opinion that the cross in the ensign was idolatrous and, consequently out of place, considering the fort was the King’s and defended in his name, his colors might be used there, but the flag bearing the King’s Arms continued in use elsewhere in the colony until the Commonwealth of England was established.
In 1643 the Colonies of Plymouth, Massachusetts Bay, Connecticut, and New Haven formed the Confederacy and were styled The United Colonies of New England. No mention, however, is made of the use of any common flag until 1686 when Governor Andros received one from the King which was the Cross of St. George flag with a Gilt Crown emblazoned on the center of the cross, with the monogram of King James II underneath.
Sources
The History and Significance of the American flag: By Emily Katharine Ide. 1917 – Boston, Massachusetts.