But Hoy's findings reveal how badly misguided, or perhaps deluded, many of us are about where our own incomes rank relative to other Australians. The Treasurer, Josh Frydenberg, speaks about his first budget Credit:Mark Graham Many of the survey respondents, both rich and poor, were wildly wrong about how their earnings compared. "Some very rich people think they are much closer to the bottom of the income distribution than they really are," says Hoy. "And some people who are quite poor think that they are way further up the scale. The misperception was quite striking."

Loading Hoy's survey also revealed an interesting political twist to this trend – low-income conservative voters were much more likely to overestimate their position on the income distribution than other types of voters. Perceptions of what it is to be a "middle income earner" have also become greatly skewed. There was a good example of this in Tuesday's federal budget. A centrepiece of Treasurer Josh Frydenberg's pitch to voters was a "low and middle income tax offset" of up to $1080. Those eligible will receive the benefit when they lodge a tax return for this financial year.

Even though the policy explicitly targets "low and middle" earners it actually lumps in a whole lot of taxpayers on high incomes. Loading The new tax offset – which Labor will match should it win government – applies all the way up the income scale to those earning $126,000 a year. Fewer than 10 per cent of taxpayers report an income that high. So how did our view of what it means to be a middle income earner become so muddled? One factor is the way average full-time earnings are equated with a middle income.

That type of worker is still widely considered to be typical even though the share of full-time employees has fallen steadily over the past five decades. We forget that almost a third of Australian workers are part-time, the majority of them women. We also forget that about one in three Australian households have incomes too low to pay income tax, including very low-paid workers, pensioners and the unemployed. Women often work part-time. Credit:Tamara Voninski Those with an average full-time wage actually sit well above the middle on our national income spectrum.

Loading Australia's personal income tax brackets may have helped distort the way we think about middle incomes. The top tax rate of 45 cents in the dollar for earnings over $180,000 a year has become an unofficial benchmark for a high income - even though only about 3 per cent of taxpayers actually earn enough to incur that top rate. The true share of Australians with a high incomes is much bigger than that. But some might consider themselves to be a middle income earner simply because they have not yet graduated to the highest tax bracket. So what does someone on a middle income in Australia really get?

Loading Coming up with an answer is more complex that you might expect. There are different ways of measuring income including Tax Office data on individual taxpayers and surveys of workers' earnings, and household incomes, conducted by the Bureau of Statistics. Research published this week by Brendan Coates and Matt Cowgill from the Grattan Institute shows the median - or middle - wage in Australia (when both full-timers and part-timers are included) – was a little under $58,000 a year. Statistics released last month by the tax office showed Australia's median taxable income in 2016-17 was even lower at $44,382 – that means half of all tax returns lodged that year were lower than that figure.

Brendan Coates reckons that when you look at the range of different income measures available the mid-point is "in a range" of between $40,000 and $60,000 a year. Many workers underestimate where their incomes rank relative to others. Credit:Virginia Star "Once you get above that you are starting to talk about a minority of Australians," he said. Dr Peter Davidson, a social policy researcher and adviser to the Australian Council of Social Services, likes to look at different household types when identifying those on middle incomes. He defines middle-income earners as single people, or sole parents, on $40,000 to $50,000 a year and couples with children on $80,000 to $90,000 a year. Davidson includes retired couples on an income close to the pension cut out point of around $60,000 a year in his middle-income category.