how do you know he's doing this without permission?
is he making 5 copies of something or 5000?
if you look at the world in black and white, then be a rat.
if you realize the world works in more complex ways, then think about it.
where are you right now posting this? Home or work?
Have you ever done anything at work that wasn't strictly by policy?
do you know if this person is making up for this "theft" by being more productive in other ways.
Personally, if someone under me had to take off work for an hour to go get color copies made for himself, I'd tell them to just do it at work. I wouldn't want to (a) loose the manpower for an hour so they can drive around making copies (b) loose the goodwill of the employee.
I would draw a clear line though with a subordinate, saying, ok, this is fine, but if this is something that will be routine for you, it's really going to impact the cost of office supplies.
But, will it really? How much are we talking about?
Again, you can say, "what's wrong is wrong" but I can't put using toner supplies in the same "wrong" catagory as rape or murder.
Get over it.