Whilst it has not been clarified via the rules, rubber bullets currently are considered to fall into the 1st tier of escalation, as evidenced in this more recent staff report (involving me): TheSheerAudacity - Staff Report: Enforcement Action Taken - Steelpoint - #9 by NessiePendragon
As noted by others, there is a exception that no punishment is levied to anyone who returns fire with lethal force against someone using rubber bullets since, in the moment, there is no way to tell apart a rubber bullet from a real bullet.
Essentially, using rubber bullets as an option of first resort is valid for escalation, but you open yourself up to being fired on by any other person with lethal force, including third party personnel who may intervene in the interests of self-defence for another person.