But it can be obfuscated enough to be, in practice, virtually useless. A single VPN service provides no anonymity. Tor provides some anonymity, using onion routing. There are three relays in normal circuits. Each of them knows where data comes from, and where it's going to. But with at least three, the entry and exit relays don't know each other.
But there are vulnerabilities. The relay early bug allowed CMU researchers to communicate between their malicious entry and exit relays, and so de-anonymize users and onion services. That bug is fixed, but of course there may be others.
However, onion routing can also be applied to VPN services. I'm typing this through a nested chain of VPNs. And one can readily use Tor via nested VPN chains. So adversaries would need to compromise multiple servers in different jurisdictions, walking through Tor and VPNs, in order to identify me. Or they could exploit intercepts from network edges with traffic analysis. But it wouldn't be easy.