Toggle would work fine. The number of times when you'll want to toggle it off will be few.
That's not true at all. In many instances, when your current target is only a few hit points away from dying, you won't want to waste your sneak attack on them. And as rogues do lots of damage, these situations might happen a lot. You can only jump once a turn so the ideal thing to do will be to use your sneak attack on your next enemy. And after level 5-6, I don't remember which level rogues get their second attack, you might have a 50% chances not using it on the first one.
It will be more so the case when you will have 3 attacks a turn and so on.
Personally, I would rather have an action button the way it is now than a toggle. It's one less click to do every round (use your sneak action vs toggle off/toggle on + attack action)