Should I report an accepted PhD thesis in which the literature review is copied verbatim from sources?
This is of course a sensitive issue. However, the ethically correct behavior is to notify someone responsible about the problem. Etiquette says to go to the advisor first, as the advisor is the person who, after the author who committed the plagiarism, stands to lose the most from the accusation. 

However, if you feel squeamish about doing it by yourself, you can talk to your advisor about the best way to proceed. 

The main issue on your part is if you will need to rely on the plagiarizer's advisor for recommendation letters. Then you should definitely proceed with caution, and with the support of your advisor, department administrators, or both. 

Of course, make sure that you've done your due diligence before going public with your charges, and to have the evidence with you when you meet with anyone about this matter.