Without getting technical the simplest distinction I’d that paid VPNs are primarily designed to obfuscate your identity for accessing the mainstream web. They essentially conceal your point of origin, but not your web journey.
In contrast TOR is designed to obfuscate your access to the deep web, the unlisted, unreferenced and often systematically blocked, hidden or surveiller/criminalised bit of the deep web known as the dark web, often living in its own protocols like .onion.
VPNs are the computer equivalent of going to a bar or a nightclub with a fake ID. You’re pretending to be someone else to get in, but otherwise doing what everyone else is doing, joining the same queue, coming in by the same door, wearing normal clothes, buying the same drinks
Tor is more like the computer equivalent of trying to attend an illegal rave whose exact location you don’t yet know, where a cartel representative, a terrorist cell member, a counterfeit goods wholesaler, an Uigur human rights activist wanted by China, and an LGBT+ organisation in Saudi are all planning business and meetings, in between a few hundred ravers who found out about the venue and decided to dance there, because they like anti-normie the scene.
To go dance in your nearest nightclub of choice as a 17 year old, the fake ID may or may not get you in, but it won’t slow you down or change your behaviour compared to your 23yo sibling attending the same party.
To make the illegal rave on Tue 8pm, you may have to visit first an anarchist cafe and look for a blue poster with a specific slogan and number, then go to the street with that number and find the blue bar, and visit the table with the poster number, at that place you might then leave with whoever is sitting there to a taxi one of you knows, and that taxi will eventually get you to the hangar where the rave is happening, where all the people above are, but also a few people who might be there to keep tabs on who attends.
So whereas the VPN may add it takes you to borrow your sister’s if from her drawer and then the 15m from your house to the mainstream venue. The TOR journey to the rave will add ten stops and a few delays to your journey, and when you get there the hangar might have been shut down or the party moved to another venue, and you can’t just Google it or check your Facebook friends for the new address.
What’s more, if you use TOR to get to the mainstream party 15m from your home, you will still need to make all those extra stops, and finally tell the taxi to take you to the mainstream club, and at the door, no one will know how you got there, what route you took, but your ID may still not be valid, and be looked at more closely than with the VPN, because you didn’t arrive with anyone and don’t feel like the regular crowd.
Whereas the regular ravers using tor to make the illegal rave and merely dance might just use tor to find the venue and take a route that makes no sense to normies, ensuring no average person can guess where they’ve been, the really dodgy or persecuted or paranoid will use both to get to the illegal rave, VPN as fake ID, and tor as convoluted route to loose your amateur tails.
But no one would use Tor to visit the normal nightclub party when a VPN would do. It’s too slow, boring, and risks making it less, not easier, to actually get in.